2. The Defendant entered the Plaintiff on October 15, 2012, as indicated in “the details of taxation disposition” in the attached Form.

The court's explanation on this part is the same as the corresponding part of the court of first instance, and thus, citing this part in accordance with Article 8 (2) of the Administrative Litigation Act and Article 420 of the Civil Procedure Act.

Plaintiff’s assertion

The substance of the instant taxation disposition was based on the premise that the Plaintiff is the person to whom the income subject to taxation or the transaction belongs, but the Plaintiff only lent the name of the business operator and controlled and managed the income subject to taxation as the actual business operator

Therefore, the instant taxation disposition is unlawful in violation of the substance over form principle under Article 14(1) of the Framework Act on National Taxes.

Judgment

Article 14(1) of the Framework Act on National Taxes declares the principle of substantial taxation by stating that “If the ownership of income, profit, property, or transaction subject to taxation is nominal and there is another person to whom such ownership belongs, the person to whom such ownership belongs shall be liable to pay taxes and the tax law shall apply.”

Therefore, in case where there is a separate person who substantially controls and manages the subject of taxation, such as income, profit, property, act, transaction, etc. different from the nominal person, the nominal person on account of form and appearance, not the nominal person, but the person who substantially controls and manages the subject of taxation, should be the person liable for tax payment.

In addition, such cases should be determined by comprehensively taking into account various circumstances such as the details of the use of name, the details of the agreement by the parties, the degree and scope of the nominal owner's involvement, the relationship of internal responsibility and calculation, the location of independent management and disposition

On the other hand, taxation summary

As a matter of principle, the tax authority bears the burden of proving the existence of the facts and the tax base. This is a special provision to change the burden of proof even if it is argued that the nominal ownership of transaction, etc. and the substantial subject of attribution are different.