Since it cannot be confirmed that it was paid by the plaintiff's funds, the representative's disposition is legitimate as bonus.

The Plaintiff cannot be the main agent of providing construction services in connection with the instant construction project, and the construction cost pursuant to the instant tax invoice cannot be appropriated as deductible expenses under the Corporate Tax Act. In addition, it cannot be confirmed that the construction cost has been paid out with the Plaintiff’s funds, and it is unclear that

Article 17 of the Value-Added Tax Act (Special Cases concerning Time of Supply for Goods)

2012 disposition of revocation of imposition of value-added tax, etc.

KOOO management consultation

O Head of tax office

2014.04.03

2014.24

1. The plaintiff's claim is dismissed.

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

On January 26, 2012, the Defendant’s notification of change in income amount of 135,00,000 income to the Plaintiff shall be revoked.

1. Details of the disposition;

A. On June 30, 2009, the Plaintiff completed the registration of incorporation for the purpose of engaging in the business of mutual cooperation loans and management advisory services.

B. On November 11, 201, the Plaintiff: (a) deducted the input tax amount based on the tax invoice dated 30, 2010 (hereinafter “Purchase tax invoice”); and (b) reported the second preliminary return of value-added tax for the year 2010 by including the said amount to deductible expenses; (c) the representative of the Plaintiff did not report sales; and (d) the Plaintiff filed a tax return for the year 2010, based on the tax invoice for the year 2010, which was composed of the total amount of 272,727,727, and the amount of tax 27,272,727, total of 299,99, items, items, and service expenses; and (e) the input tax invoice for the year 2010, which was the tax invoice for the year 2010.

D. The Plaintiff filed a request for pre-assessment review, and the portion of the corporate tax for the business year 2010 and the corporate tax for the business year 2010 was lawful, and the representative’s bonus disposition was 165,000,000 won, which was directly transferred from the Plaintiff’s corporate account, was excluded from bonus disposition, and it was determined that the representative disposition was lawful as bonus, since it cannot be confirmed that the remainder of 135,00,000 won was paid as the Plaintiff’s funds.

E. Accordingly, on February 1, 2012, the Defendant imposed imposition of KRW 35,770,90 on the second term value-added tax for the year 2010, and KRW 21,481,530 on the corporate tax for the business year 2010. The Defendant, on January 26, 2012, issued a notice of change in the amount of income (hereinafter referred to as the “instant disposition”). The Plaintiff filed a request for review following an objection, and dismissed the disposition of value-added tax and corporate tax on September 21, 2012 by the Commissioner of the National Tax Service, and received a decision to impose the labor income tax for the portion on the representative by re-auditing the amount to be disposed of as bonus, and as a result, received the decision that the Defendant imposed the labor income tax for the portion on February 1, 2011 by re-auditing the construction cost to the Plaintiff.”

[Ground of recognition] Each entry of Gap evidence 1, 2, Eul evidence 1, 2, 7 through 9 (as ...., number 1) and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The instant tax invoice is paid for construction cost of KRW 300 million to the O public in lieu of the construction cost according to the building owner KimO and the service contract. Since the construction cost of KRW 300 million was fully paid to the O public, it is illegal to dispose of the representative bonus, deeming that the ownership of KRW 135 million out of KRW 300 million is unclear.

B. Relevant statutes

Attached Form. The entry in the relevant statutes is as follows.

(c) Fact of recognition;

1) The service contract between the Plaintiff and KimO

"GlaO entered into a service contract with the Plaintiff on December 2009 (hereinafter "the service contract of this case") with respect to the OO-O-O-O-O-O-O-O-O-O-O-O-O-O-5 ground multi-households and multi-family house 2 unit construction (hereinafter "the housing of this case," and "the construction of this case") as follows," and the service contract.

Section 1 (Purpose and Criteria of Services) The purpose of this Agreement is to carry out the duties of the selection and completion of construction contractors with respect to OOO OO 895-5 multi-household construction projects, and of the duties of tax management supervision. The Plaintiff (B) will carry out on behalf of KimO (A) the selection of contractor and subcontractor companies and the disbursement of funds in connection with multi-household construction projects.

Article 3 (Period)

The commencement date of the performance of duties under this contract shall be the date of the contract, and the expiration date shall be 30 days after the completion of the building.

Article 4 (Remuneration)

The amount of remuneration for this service shall be 2% of the total construction cost (1.4 billion won).

Article 5 (Payment of Remuneration)

Remuneration shall be paid within three days after the contract expires.

VI.(Settlement of Payment by Proxy for Construction Work)

B If the subcontractor pays the relevant construction cost on behalf of Party B on behalf of Party B, Party B will settle the amount calculated by adding the interest of 18% per annum to the amount paid by Party B.

2) Contract agreement between the Plaintiff and theO co-ownership

"A) On March 25, 2010, KimO entered into a contract for construction with OO-public corporation to contract the instant construction work with the cost of KRW 1479.5 million (including value-added tax)" (B) O-public corporation suspended the instant construction work on July 2010. The KimO notified that it terminated the instant contract with O-public corporation around August 23, 2010.

(C) On September 30, 2010, the KimO agreed to settle the remaining amount of KRW 276,978,904, which remains after deducting the payment from the payment for the completed portion, as the payment for the completed portion is KRW 310,000,000,000,000 which was already paid by the KimO, between the OO and the OO on September 30, 2010 (hereinafter referred to as the “instant agreement”). The OO official prepared and issued a written confirmation of the waiver of the construction to waive the instant construction to the OO on the same day, and issued it on September 30, 2010, the OO official issued a tax invoice for the 276,978,900,000, the tax amount of KRW 22,50,000,00, and the tax amount of KRW 250,000.

3) Claim for the payment of the construction price for the O-public KimO

A) A public office filed a lawsuit against KimO (Seoul Central District Court 201Gahap11059), and KimO filed a claim for compensation, etc. for damages against a counterclaim (Seoul Central District Court 201Gahap52913). In the process of the above lawsuit, OO public office claimed that the amount of public subscription paid by KimO is KRW 255,00,000,000, and filed a claim for payment of KRW 690,981,031, which was the remainder after deducting the amount of payment from the amount of KRW 945,981,031. O public official and the plaintiff filed a claim for compensation for damages from the above court on February 8, 2012. In relation to the main lawsuit, KimO paid damages from the above court, 276,978,904, and damages from delay recognized by the O public agreement, OO and the amount of damages from the damages from delay in lieu of the amount of damages from the damages from the damages from the damages from the damages.

B) BothO-public and KimO-O all appeals (Seoul High Court 2012Na25397) and appeals (Supreme Court 2013Da88362) but all appeals were dismissed, which became final and conclusive on February 27, 2014.

4) Details and accounts of the Plaintiff’s payment of construction cost, and tax processing

A) The amount transferred directly from the Plaintiff’s account to the O-public account is KRW 165,00,500.

(B) On May 4, 2010, an O-public official issued a tax invoice consisting of KRW 110,000,000, total amount of KRW 100,000,000, and KRW 100,000,00. On July 30, 2010, the O-public KimO stated that it is a “alternative” on the said tax invoice and stated that it is a substitution with the Plaintiff’s tax invoice (if an O-public side of the supplier under the instant tax invoice is affixed, the Plaintiff asserts that there is an obstacle to the Plaintiff’s failure to supply the instant tax invoice, and the Plaintiff issued a number of sheets consisting of the total amount of KRW 9,00,000 on May 3, 2010, and the said amount was paid to the O-public.

D) On May 28, 2010, the Plaintiff received a deposit slip that KRW 200 million was deposited from the O co-ownership.

E) The Plaintiff reported the input tax amount by including the instant tax invoice at the time of the preliminary return of the second taxable year value-added tax in 2010. However, there was no output tax amount related to the OO co-ownership. The Plaintiff did not include the accounts receivable, etc. on the balance sheet attached to the tax return of the business year 2010, and the total assets amounted to 163,064,000 won.

F) At the time of the pre-assessment review, the Plaintiff responded in writing to KRW 300 million as it did not have funds to the Plaintiff Company, and the representative director borrowed and paid it from outside, and the representative director paid it.

5) Provisional seizure, etc. against the plaintiff KimO

A) The instant housing was approved on October 12, 201 for use on the instant housing.

B) On June 21, 2011, the Plaintiff filed an application for provisional attachment against KimO for the instant real estate (Seoul Central District Court 201Kadan2966), and received a decision of provisional attachment that constitutes a claim claim 265,965,600. The Plaintiff, as a provisional attachment creditor, made a demand for distribution under the compulsory auction procedure (Seoul District Court Seosan Branch Branch 2012ta7804) against OO for which OO filed an application for the instant real estate against KimO.

C) On March 9, 2012, in the process of filing an objection, KimO submitted to the OO a written confirmation that KRW 300 million of the construction cost paid by the Plaintiff on behalf of the Plaintiff ought to be settled.

D) On February 7, 2013, the Plaintiff filed an application for payment order (Seoul Central District Court Decision 2013 tea5621) against KimO for payment of KRW 28,000,000 and KRW 328,000,000,000 paid by the Plaintiff on behalf of OO public (Seoul Central District Court Decision 201Da5621), and it is finalized as it is because KimO did not raise any objection.

E) KimO, a parent of KimO, is the Plaintiff’s auditor, and KimO’s son is the actual operator of the Plaintiff.

[Recognizing the above, the court below held that Gap evidence 2 to 6, Eul evidence 4 to 11, Eul evidence 4 to 11, the witness's testimony as a witness, and the purport of the whole legal theory.

1) According to the above facts, the Plaintiff, according to the instant service contract, and the Plaintiff, performed the business of fund and tax management in accordance with the instant service contract with KimO, and received 2% of the total construction cost as service cost, not a party to the instant contract. Moreover, the Plaintiff is only entitled to receive the payment from KimO in addition to interest when paying the construction cost by replacing KimO in accordance with the instant service contract. Accordingly, the Plaintiff cannot be the principal agent providing construction services in connection with the instant construction project, and the construction cost under the instant tax account statement cannot be appropriated as deductible expenses under the Corporate Tax Act.

2) In cases where a corporation appropriates the processing costs in its account book, barring special circumstances, the profit of the corporation equivalent to the processing costs ought to be deemed to have been leaked out of the company. In such cases, there is a need to prove in the corporation’s side that the total processing costs were not leaked out of the company (see Supreme Court Decision 98Du16347, Dec. 24, 199).

Considering the following circumstances revealed in the facts of lives and recognition, 135,000,000 won, which was not proved to have been disbursed as the Plaintiff’s funds among 300 million won related to the purchase tax invoice of this case, shall be deemed to have been leaked as the Plaintiff’s profits were leaked out of the company, and the attribution is unclear.

① The Plaintiff handled the claims to be paid by KimO only in the account book without including them in the assets book. KimO’s father’s father is the Plaintiff’s audit and inspection, and it is unclear whether KimO’s ZO’s father is the Plaintiff’s actual operator, who is the Plaintiff’s actual operator, and the Plaintiff could receive the actual claim from KimO. It is insufficient to recognize that the Plaintiff was subject to a provisional attachment and payment order against KimO, solely because it is insufficient to recognize that the Plaintiff had claims against KimO and thus, the corporation’s actual profits were not leaked out of

② It is recognized that O-public borrowed KRW 30 million on March 25, 2010. However, it is difficult to find out whether the Plaintiff prepared and paid the above loan certificate to the Plaintiff, and whether the Plaintiff’s money was paid to the Plaintiff for new public service. Moreover, it is difficult to find out how the above loan certificate was settled at the time of the agreement in this case.

③ On September 30, 2010, KimO prepared the instant agreement with the OO on the settlement of the construction cost, and up to that time, the amount paid as the construction cost is KRW 310 million. However, the date of the preparation of the instant tax invoice is July 30, 2010, and only the amount that the Plaintiff spent until that date is included in the deductible expenses when filing a corporate tax return based on the instant tax invoice. The amount that the Plaintiff spent on behalf of the OO after the preparation of the instant agreement is irrelevant to the instant tax invoice.

④ Since 90 million won paid by KimO as a check was paid out of the funds of KimO, it is not recognized that it was paid out of the Plaintiff’s funds. Therefore, since the above amount cannot be recognized as the Plaintiff’s loss, it is unclear that it would be attributed to KRW 90 million of the profit of the Plaintiff corporation that was leaked out of the company.

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit, and it is so decided as per Disposition.