early 2010 Heavy3079 ( October 25, 2012)

It is legitimate to confirm the omitted amount of sales and impose tax on the basis of the amount of cash expenditure not reflected in the account book.

The details of the Plaintiff’s report include errors or omissions, and the Plaintiff’s failure to keep documentary evidence that enables verification of actual sales, or the actual sales of documentary evidence kept by the Plaintiff cannot be verified. Therefore, it is reasonable to deem that the Plaintiff’s imposition of value-added tax and general income tax is lawful based on the amount of cash expenditure not reflected in the account book and the amount of cash expenditure not reflected in the account book

2012Guhap24586 Disposition of revocation of Value-Added Tax, etc.

Jeon AAAA

Head of Pyeongtaek Tax Office et al.

April 26, 2013

May 31, 2013

1. The plaintiff's claim is dismissed.

2. The costs of lawsuit shall be borne by the Plaintiff.

On January 4, 2010, the head of Pyeongtaek-si Tax Office revoked each disposition of KRW 000 of the value-added tax for the second period of 2006 against the Plaintiff, the value-added tax for the first period of 2007, the value-added tax for the first period of 000, and the value-added tax for the second period of 2007 for the second period of 2007. The imposition of KRW 000 of the global income tax for the first period of 2006 against the Plaintiff on January 7, 2010 and KRW 000 of the global income tax for the second year of 2007 (the Plaintiff appears to have revoked each disposition of KRW 00 of the global income tax for the first period of 2006 against the Plaintiff (the date of the disposition of the head of Defendant Pyeongtaek-si Tax Office was stated on January 18, 2010, and each of these was stated on January 11, 2010.)

1. Details of the disposition;

A. From June 2, 2005, the Plaintiff is running a wedding hall business under the trade name of "CC Movable Property and PPS (hereinafter referred to as the "instant business establishment") from 00,000 to Masung-si.

(2)1) From May 6, 2009 to June 16, 2009, the Director of the Central Regional Tax Office of China conducted a comprehensive investigation into personal taxes with the Plaintiff, and from the date of the entry into the account, the Plaintiff paid the sales of the instant workplace to customers through the method of deposits without passbook payments, and omitted sales by appropriating only a part of them in the account book. On June 24, 2009, the expected notified tax amount of Jun. 24, 2009 (value-added Tax: : 00 won, 00 won, 00 won, 200 won, 200 won, and 00 won, 2000 won (2 years, 2007), and 100 won (2 years, 2008, 20008, 2000 won) and 2005 won (2 years, 2000, 20005 won).

2) On July 23, 2009, the Plaintiff filed a request for pre-assessment review with the Director of the Central Regional Tax Office on July 23, 2009. The Director of the Central District Tax Office of China judged that it is reasonable to revise the value-added tax and the income tax on the Plaintiff on December 28, 2009 (1: 00 won in 2006, and 2006 in 2007: 00 won in 200, and 000 won in 207: 00 won in 200, and 000 won in 206: 00 won in 205: 00 won in 200 won in 206, 000 won in 207: 00 won in 200 won in 200 won in 200 won in see 300 won in see 10,000 won in see 200 won in see see 200000 won in see See

(A) The omission of the Plaintiff’s cash outflow amount, which is not reflected in the book.

(No. 2) The Plaintiff’s funding details are omitted.

(3) The omission of particulars of calculation of the omitted amount of sales

(A) The necessary industry and the details of non-Inclusion are omitted.

3) Accordingly, on January 4, 2010, the head of Pyeongtaek-si Tax Office revised and notified the Plaintiff of the global income tax of 00 won and 0000 global income tax of 206 global income tax of 2006, 000 won of value-added tax of 2006, and 000 won of value-added tax of 1 year of 2007, and 2 year of 2007. The head of the Defendant Samsung-si Tax Office determined and notified the Plaintiff of the global income tax of 00 won and 000 global income tax of 2007.

C. 1) On April 7, 2010, the Plaintiff dissatisfied with the imposition of the above value-added tax, and filed an objection with the director of the Central Regional Tax Office of China on April 7, 2010. On May 27, 2010, the director of the Central District Tax Office of China again determined that the amount of 000 won out of the credit card amount used in the year 2007 was deducted from the omitted sales amount, and that the remainder is dismissed as there is no reason.

2) On April 5, 2010, the Plaintiff dissatisfied with the imposition of the above global income tax, filed an objection with the director of the Seoul Regional Tax Office on April 5, 2010, and the director of the Seoul Regional Tax Office dismissed the Plaintiff’s application on July 30, 2010 (in relation to the Plaintiff’s amount spent on the credit card in 2007, it was excluded from the hearing on the ground that the correction was made ex officio by Defendant Samsung F&A

3) On July 2, 2010, the head of Pyeongtaek-si Tax Office corrected that the Plaintiff’s filing of the objection under the above paragraph (1), and that the head of the Defendant would reduce the amount of KRW 000 from the value-added tax for the first period of July 2, 2007, and KRW 00 from the value-added tax for the second period of February 2007, and the head of the Defendant Samsung Tax Office would reduce the amount of KRW 000 from the global income tax for the year 2007.

D. 1) On August 30, 2010, the Plaintiff appealed and tried to the Tax Tribunal on August 30, 2010, and on April 25, 2012, the tax tribunal determined that: (a) the value-added tax imposed on the Plaintiff on the Plaintiff on the KRW 1,000, and KRW 2,000 in 206, and KRW 1,0000 in 207, and KRW 2,0000 in 2,007, the global income tax imposed on the Plaintiff by the head of the tax office on the Plaintiff; (b) the imposition of KRW 00 in 2006, and KRW 00 in 207, the imposition of KRW 1,000 in 206, and KRW 200 in 200 in 206; and (c) the tax base and amount calculated by deducting the remaining amount of the global income tax and global income tax.

2) According to the decision of the said Tax Tribunal, the Plaintiff, and the head of Pyeongtaek-si Tax Office, on May 18, 2012, corrected that the amount of KRW 000 from the value-added tax for the first term of 2006, and KRW 000 from the value-added tax for the second term of 2006, respectively, was reduced, and the head of Defendant Samsung District Tax Office corrected that the amount of KRW 00 from the global income tax for the year 2006.

E. During the instant lawsuit, the Defendants confirmed that the amount of KRW 000,000, out of the amount of the credit card used in the year 2006, which the Plaintiff submitted in the judgment, was reflected in the account book, and subsequently corrected on October 4, 2012, by reducing the amount of KRW 000,000,000 from the amount of the sales omission (i.e., the amount of KRW 000,000). The Defendants corrected that the amount of KRW 00,000 should be reduced from the global income tax for the year 2006 (i.e., the amount of KRW 20,000, KRW 000, KRW 2000, and KRW 200,000 for each of the global income tax for the year 200,000, KRW 200,000 for each of the global income tax for the year 200 (i.e., the amount of KRW 200,0000).

[Reasons for Recognition] The facts without dispute, Gap evidence 1, 8 through 13 (including each number, hereinafter the same shall apply), and Eul evidence 1 to 17, and the purport of the whole pleadings

2. Whether each of the dispositions of this case is legitimate

A. The plaintiff's assertion

The plaintiff asserts that each disposition of this case is unlawful on the following grounds.

1) Claim for violation of applicable taxation

Article 16(1) of the Framework Act on National Taxes prescribes that "where a person liable to pay tax has kept and recorded a book pursuant to tax-related Acts, the investigation and determination of the relevant national tax base shall be based on the relevant book and documentary evidence related thereto." However, in 2005 and 2006, the Plaintiff did not submit a normal book while operating the instant place of business, including a contract and tax invoice, but did not find it. In 2007 and 2008, the Plaintiff prepared and kept books and documentary evidence (e.g., wedding and annual contract, tax invoices, accounts accounts, etc.), and submitted both in the course of investigation, and calculated the omitted amount of sales on the basis of the amount omitted sales according to documentary evidence submitted by the Plaintiff and the amount of cash expenditure not reflected in the book. In addition, the Defendant, while the Defendant did not properly specify the time of sales, found that the service was incurred at the relevant time when cash expenditure was made. Therefore, each disposition of this case is based on the principle of taxation.

2) As to the omission of sale

The Plaintiff obtained a loan of KRW 000 on August 24, 2004 from Songpa-gu Seoul 000 as security and used it as a business fund for the instant business establishment. As such, the Defendants should deduct the above amount from the omitted sales amount in 2006 and 2007.

3) The assertion regarding the additional amount of vindication

The Defendants calculated the value added tax and the comprehensive income tax by including the amount omitted in sales in the amount omitted, as stated in attached Form 1, when the Plaintiff stated the additional amount, such as the amount without passbook entry, in the amount omitted from sales, and when the Defendants judged the amount omitted from sales, it should be deemed necessary expenses.

4) Claims related to insurance premium

Although the insurance premium paid by the Plaintiff is related to the instant workplace, it should be included in the necessary expenses, the Defendants did not industry it as necessary expenses.

5) Claims relating to the amount spent on credit cards in 2007

The Defendants reflected 000 won out of the Plaintiff’s credit card use amount of 2007 000 won in cost, but did not reflect the remainder of 000 won. However, since the Plaintiff’s credit card use amount is related to the instant business place, it should be included in cost.

6) Claim on the increase of provisional disposition income

Although the amount of increase in the plaintiff's provisional disposition income resulting from the investigation of the Central Regional Tax Office is confirmed to be the source of funds and should be deducted from the amount omitted sales in 2007, the defendants did not deduct this.

B. Relevant statutes

Attached Table 2 shall be as stated in the relevant statutes.

C. Determination

1) As to the assertion regarding the violation of the underlying taxation principle and the omission of sales

A) Generally, when the taxpayer’s return is corrected due to an error or omission in the taxpayer’s return, it is deemed that there is an error or omission in the details of the return by other data, and if it is possible to conduct a field investigation, it can be corrected even by other data. In this case, on-site investigation is a method that can be objectively conducted by gathering the actual income, and on-site investigation is a method that investigates the amount deposited into the account of the taxpayer’s financial institution and determines the total income amount of the taxpayer by means of investigating the amount deposited into the account of the taxpayer’s financial institution, and it falls under a lawful on-site investigation method (see Supreme Court Decision 97Nu9895, Mar. 24, 1998).

B) In light of the following circumstances, it is reasonable to view that: (a) the Plaintiff’s report contains errors or omissions; (b) the Plaintiff is not in custody of documentary evidence that enables verification of actual sales; or (c) the Plaintiff is not in custody of documentary evidence that the amount of sales was confirmed based on the amount of cash expenditure not reflected in the account book; and (b) the value-added tax and comprehensive income tax are imposed on the basis of the fact that the amount of sales was confirmed based on the amount of sales omitted and the amount of cash expenditure not reflected in the account book. Accordingly, this part of the Plaintiff’s assertion is without merit.

① As the Plaintiff, those who engage in a wedding business as the Plaintiff are preparing a wedding use agreement or annual conference agreement in which the date, time, number of meals, etc. are recorded, and a list of reservations based thereon. In addition, those who use a wedding hall have received congratulatory money, etc. from visitors and hold a large amount of cash in cash, and thus, they can not be verified if they are omitted without entering cash sales in a book, and if so, the most basic data to confirm the sales are the list and the contract. On May 6, 2009, the Plaintiff was investigated by the Central District Tax Office, and the Plaintiff was requested to submit a register of reservations, including the date and time of wedding, the name of the new and new departments, and the number of expected persons, but after the commencement of the business, prepared a register of reservations, but did not keep the register, but did not submit the register of reservations, including the details of payment by event and the details of payment by personnel expenses, etc., and did not submit the record of accounts.

② 원고는 2005년경 한DD로부터 안성시 공도읍 OO리 000 대 543㎡，같은 리 0000 대 465㎡와 그 지상의 건물을 매수한 후 2005. 6. 2.부터 위 건물에서 이 사건 사업장을 운영하고 있다. 원고는 2005. 9. 30.경부터 2007. 12. 10.경까지 한DD에게 매매대금 0000원과 지연이자 0000원 합계 0000원을 지급 하였고， 위 금원 중 일부는 이 사건 사업장에서 발생한 매출액으로 지급하였으나， 원고는 이러한 내용을 장부에 기재하지 않았다.

③ The “acquisition.hwp” file (Evidence No. 20) kept by EE, an employee of the Plaintiff, includes the following contents. In addition, the files (Evidence No. 22) kept by EE, and the following contents are included. According to this, the Plaintiff appears to have reported an amount less than the actual sales amount by calculating sales amount or destroying account statements according to the value-added rate set in advance in the process of reporting value-added tax, etc. [Plaintiff also under investigation conducted by the Central Regional Tax Office on May 25, 2009, the Plaintiff ordered to reduce sales amount and reduced sales amount due to lack of expenses to be used for building maintenance or repair after the opening of the business. The Plaintiff requested a tax accountant office to pay less taxes. However, the Plaintiff refused to purchase the said invoice on May 25, 2009 (Evidence No. 22). The Plaintiff’s assertion that the Plaintiff purchased the said invoice, including the Plaintiff’s new invoice, and then, appears to have different reasons from the Plaintiff’s trading volume.

④ From November 26, 1998 to March 10, 2001, the Plaintiff engaged in wholesale and retail business with the trade name "OOben", and from December 1, 1994 to August 12, 2005, "OOben" respectively. The Plaintiff's income amount is 00 won in 200,000 won in 202, and 000 won in 204, and 000 won in 200,000 won in 20,000 won in 20,000 won in 20, and 300,000,000 won in 20,00 won in 20,000 won in 20,00 won in 20,00 won in 20,000 won in 20,00 won in 20,000 won in 20,000 won in 20,000 won in 20,00.

⑤ On June 17, 2009, the day following the closure of the investigation into the integration of individual taxes against the Plaintiff, the Central Tax Office of Central Regional Tax Office received information on the Plaintiff’s tax evasion to the Central Tax Office, and the above information was accompanied by the reservation status (including the name and place of the instant business establishment, the minimum number of meals, the guarantor, the maximum number of meals, and the color of meals) from April 2005 to April 2007. In order to determine the quantity of food to be prepared per event, such as the marriage type, the guarantor and the respondent of the instant business establishment are required to pay the value of the guarantor’s food contract for the instant business establishment, and it is difficult to view that the number of guests who actually attended the marriage type, etc. and provided meals falls short of the guarantor’s number, and the volume of the surety’s food contract for the instant business establishment should be equal to or equal to the amount of the principal’s food contract for the instant case’s use, and thus, it is difficult to see that the Plaintiff’s sales of the instant business establishment was included in the agreement.

2) As to the assertion regarding additional supporting amount, insurance premium, and amount used on credit cards in 2007

A) In the event that a tax assessment is conducted based on the on-site investigation decision, the taxpayer should assert and prove the necessary expenses corresponding to the omitted sales, and if necessary expenses are not recognized by the tax authority, the taxpayer should assert and prove.

B) Comprehensively taking account of the overall purport of the pleadings in the evidence No. 24, the Defendants may recognize the facts as necessary expenses the sum of KRW 000 as indicated in the attached Table 1’s attached hereto, stated in the Plaintiff’s Schedule 5, among the KRW 000 as indicated in the Plaintiff’s 200, and the Defendants reflect in the Plaintiff’s cost KRW 000 out of the amount used in the credit card No. 2007 as indicated above. However, the evidence submitted by the Plaintiff alone was 00 as indicated in the “Additional Document No. 1” minus the Defendants’ necessary expenses, and KRW 00,000, and the amount paid by the Plaintiff was 00,000, and the amount paid by the credit card No. 1 in 2007 minus the amount reflected by the Defendants in the cost, and there is no other evidence to support this part of the Plaintiff’s assertion.

(B) Table 5 omitted.

3) Claim on the increase of provisional disposition income

According to the above facts, the director of the Central Regional Tax Office of China calculated the amount not reflected in the account book among the plaintiff's cash expenditure and the amount used for private use by the plaintiff as the omitted sales amount. Thus, the plaintiff's income increase due to the omission of sales cannot be considered as provisional disposition income, and the plaintiff's increased income amount cannot be considered as the source of funds for the following year because it was used in the corresponding year, and it cannot be deducted from the omitted sales amount. Accordingly, this part of the plaintiff's assertion is without merit.

3. Conclusion

Then, the plaintiff's claim of this case is dismissed as it is without merit, and it is so decided as per Disposition.