The submission of duplicate documentary evidence and false receipts with the evidence of land acquisition fund constitutes fraud or other unlawful acts.

With respect to a report on the transfer tax by applying the sum of the actual cost for the purchase of land as the acquisition price of land, the price for the construction project shall not be recognized as the price for the acquisition of land, and it shall be reasonable to apply the exclusion period of 10 years to fraudulent or other unlawful acts.

2017Guhap63894 Revocation of Disposition of Imposing capital gains tax

AA, BB

a) the Director of the Tax Office, B.

May 1, 2018

June 21, 2018

1. A. Of the disposition of imposition of the principal income tax for the year 2008 on July 1, 2016 rendered by Defendant AA head of a tax office to Plaintiff AA on July 1, 2016, the portion exceeding the X from among the disposition of imposition of the principal income tax for the year 2008, and the portion exceeding the XL from among the disposition

B. Of the imposition of the principal capital gains tax for the year 2008 on August 1, 2016 that Defendant BB director made to Plaintiff BB on August 1, 2016, the portion exceeding xx won among the imposition of the principal capital gains tax for the year 2008, and the portion exceeding x source among the imposition of the additional x

C. Of the imposition of the local income tax Xx won on July 1, 2016 by the head of Si/Gun/Gu to Plaintiff AA on July 1, 2016, the portion exceeding thex won among the imposition of the local income tax X

(d) Defendant** the Special Metropolitan City BB head on August 1, 2016, the imposition of local income tax Xx members against Plaintiff BB on August 1, 2016, each of which exceeds the Xx members, shall be revoked.

2. The plaintiffs' remaining claims are dismissed.

3. Of the costs of lawsuit, 2/3 of the costs of lawsuit are borne by the Plaintiffs, and the remainder by the Defendants.

Cheong-gu Office

[2017Guhap63894]

On July 1, 2016, the head of a tax office having jurisdiction over the imposition of the principal income tax for the transfer income tax for the year 2008, which was made to Plaintiff AA on July 1, 2016, and the imposition of the principal income tax for the transfer income tax for the year 2008 and the imposition of the principal income tax for the transfer income tax for the year 2008, which was made by Defendant BB to Plaintiff BB, is revoked.

[2017Guhap59598]

Defendant**: (a) the head of the Special Metropolitan City Aa on July 1, 2016, imposed local income tax on Plaintiff AA; and (b) Defendant* Special Metropolitan City BB on August 1, 2016, imposed local income tax on Plaintiff BB by the head of the local income tax.

1. Details of the disposition;

A. On Aug. 31, 2004, the plaintiffs were married and acquired from the plaintiff AA on Aug. 31, 2004, aaa (hereinafter "non-party company") with the land of 91 square meters prior to 203-6 square meters prior to 203-6 square meters (hereinafter "AA land"), and the land of 2259 square meters prior to 204-13 square meters prior to the same Ri (hereinafter "BB land"), respectively, from the plaintiff AA land of 3.48 billion won for the land of 3.8 billion won for the land of 23, 2008, and the land of 2.8 billion won for the land of 200 million won for the land of 1.28 billion won for the land of 200 million won.

B. The Plaintiffs initially decided to trade the instant land between the Nonparty Company and the Nonparty Company in April 2004. AA land is KRW 852,00,000 (2,130 square meters x 400,000). BB land is 273,60,000 won (=684 square meters x 400,000). BB land is 273,60,000 won, but the Plaintiffs entered into a sales contract (hereinafter referred to as “the first sales contract”) with the representative director of the Nonparty Company as the sales contract for construction work for DD, and around August 2004, the Plaintiffs entered the sales contract for AA land into a sales contract again by setting the sales contract for B B land into KRW 1,550,00,000 and KRW 598,60,000,000 (hereinafter referred to as “the second sales contract”).

C. On January 23, 2008, Plaintiff AA reported and paid KRW xx members of capital gains tax and KRW xx members of resident tax, with the acquisition price of Party A’s land as KRW 1,50,000,000, upon filing a preliminary return of capital gains tax with the head of the competent tax office on January 23, 2008. Plaintiff BB reported and paid KRW xx members of capital gains tax and KRW xx members of resident tax, with the acquisition price of Party BB’s land as KRW 598,60,000, when filing a preliminary return of capital gains tax with the head of the competent tax office on February 11, 2008.

D.** The Director of the Regional Tax Office conducted an investigation into capital gains tax on the Plaintiffs from May 16, 2016 to June 30, 2016, and then notified each of the Defendants Aa director of the District Tax Office and BB director of the District Tax Office to impose capital gains tax by applying the above acquisition value, deeming that the acquisition value reported by the Plaintiffs regarding the instant land is denied, and the acquisition value of the land AA is KRW 444,813,200, and the acquisition value of the land BB is KRW 142,786,80.

E. Accordingly, on July 1, 2016, the director of the tax office having jurisdiction over Defendant AA had the Plaintiff AA for the transfer income tax of 2008 and the director of the tax office having jurisdiction over Defendant BB for the transfer income tax of 1 August 2016 (hereinafter “instant disposition of transfer income tax”).

F. As a result of the instant disposition of capital gains tax, Defendant** Special Metropolitan City A* on July 1, 2016, Defendant AA imposed local income taxxxx, Defendant** Special Metropolitan City BB on Plaintiff BB, respectively (hereinafter “instant disposition of local income tax,” and “instant disposition” along with the instant disposition of capital gains tax).

G. On September 26, 2016, Plaintiff AA filed an appeal against the instant disposition with the Tax Tribunal on December 27, 2016, and received a decision of dismissal on the instant disposition of local income tax; and on February 20, 2017, Plaintiff BB filed an appeal against the instant disposition with the Tax Tribunal as Defendant BB head of the tax office on October 21, 2016. On the other hand, Plaintiff BB filed an appeal against the instant disposition with the Tax Tribunal by designating the disposition authority as Defendant BB head of the tax office. The Tax Tribunal dismissed Plaintiff BB’s appeal against the instant disposition of local income tax on February 20, 2017, but did not make a separate decision as to the instant disposition of local income tax.

[Ground of recognition] Facts without dispute, Gap evidence 1 through 3, Eul evidence 1 through 3, Eul evidence 20, Eul evidence 1 and 2 (including each number), the purport of the whole pleadings

2. Determination as to Defendant** Special Metropolitan City bb's principal defense

Defendant*** (BB) asserts that the part of Plaintiff BB’s lawsuit on the claim for cancellation of local income tax is unlawful as it exceeds the filing period, since Plaintiff BB filed an appeal on the disposition of transfer income tax of this case and did not file an appeal on the disposition of local income tax of this case.

According to the evidence evidence No. 20, the plaintiff BB entered only the "BB director of the tax office" in the "Disposition Authority" upon submitting a written appeal to the Tax Tribunal on October 21, 2016. However, the "Disposition" includes both the transfer income tax disposition of this case and the local income tax disposition of this case. Although the plaintiff BB did not accurately specify the disposition of the local income tax of this case, it is obvious that the plaintiff BB's intent was in objection to the disposition of the local income tax of this case. Article 63 (1) of the Framework Act on National Taxes provides that "the Commissioner of the National Tax Service may ex officio correct it if the contents or procedures of the request for review are minor, and Article 81 of the Framework Act on National Taxes provides that "the above Article 63 of the Tax Tribunal shall apply mutatis mutandis to the tax Tribunal, and that the plaintiff BB did not separately designate the disposition of this case but did not request the Local Income Tax Tribunal to correct the disposition of this case.

In addition, Article 56(3) of the Framework Act on National Taxes provides that an administrative litigation against a disposition under tax-related Acts shall be filed within 90 days after the decision on a request for examination or adjudgment is notified. However, if the decision on examination or adjudgment is not notified within 90 days, an administrative litigation may be filed from the date the decision period expires even before the decision is notified. Thus, it is legitimate that Plaintiff BB filed the instant lawsuit on October 21, 2016, which is obvious that 90 days after the date the request for adjudication was filed regarding the disposition of local income tax of this case, was filed on March 27, 2017.

**The principal defense of the Head of the Special Metropolitan City bb is without merit.

3. Whether the instant disposition is lawful

A. The plaintiffs' assertion

1) The instant disposition was conducted on the premise that the 10-year limitation period is applied to cases where the Plaintiffs evaded capital gains tax due to “Fraud and other unlawful acts.” However, the Plaintiffs prepared a secondary sales contract by including land creation expenses, etc. in the purchase price pursuant to the agreement to be transferred under the condition that the entire housing complex is possible, even if the construction was not actually performed due to the nonperformance of the obligation of DD, the land creation expenses can be deducted from the transfer price, and among them, the construction expenses of the building could not be separately specified from the transfer price. Accordingly, the Plaintiffs’ submission of the second sales contract at the time of filing a transfer income tax report cannot be deemed as active fraud or other unlawful acts. Moreover, the Plaintiffs’ submission of the same account transfer details to the same account transfer and the receipt, etc. prepared retroactively due to simple mistake, etc. as well, all of the above Plaintiffs’ acts are merely the use of the documents or data existing without the purpose of tax evasion, and thus, the imposition and collection of taxes and the imposition of national taxes cannot be seen as a violation of the Punishment of Tax Evaders Act.

2) Even if the exclusion period for imposition of ten years is applicable, the acquisition value shall be, in principle, based on the actual transaction value. In case where special circumstances exist, such as where there is no evidence verifying the actual transaction value, or where it is difficult to trust any important part, the acquisition value shall be the acquisition value of transaction example, appraisal value, and conversion value. In this case, as long as DD acknowledges the authenticity of the secondary sales contract, as long as 2,148,600,000 of the purchase price stated in the secondary sales contract is recognized as the acquisition value of the land in this case, the Plaintiffs should be recognized as the acquisition value of the land in this case, and the Defendants cannot be denied without permission. Even if the purchase price of the secondary sales contract cannot be recognized as the actual transaction price of the land in this case, insofar as the Defendants failed to prove the actual transaction price, the Defendants determine the acquisition value of the land in this case based on conversion value, etc., by selecting only a part of the materials submitted by the Plaintiffs. The Defendants are unlawful.

3) Even if the purchase price stated in the secondary sales contract cannot be acknowledged as the actual transaction price, in light of the following: (a) in light of the advertising price by the non-party company for sale in lots and the prosecutorial investigation result, the amount paid by the plaintiffs to DD with respect to the instant land, at least KRW 1,233,130,000, the purchase price under the first sales contract constitutes the actual transaction price of the instant land; (b) so, at least KRW 852,00,000, which is calculated at least KRW 400,000 per square, and KRW 1,125,60,600,000, which is the total purchase price of the instant land, shall be recognized as the acquisition price of the instant land; and (c) construction cost of KRW 875,637,00 (=2,001,237,000 paid by the plaintiffs to DD - KRW 1,25,600,000).

4) The local income tax is a tax item newly established through the amendment of the Local Tax Act on January 1, 2010. According to Article 4 of the Addenda to the Local Tax Act (Act No. 9924, Jan. 1, 2010), the local income tax may be imposed from the first return or determination after January 1, 2010. The Plaintiffs are subject to the transfer of the instant land on or around January 1, 2008, and thus, have established the capital gains tax and the tax liability for local income tax at that time. However, the local income tax is entirely different from the local income tax, so it is unlawful to impose the local income tax in this case on the Plaintiffs.

B. Relevant statutes

It is as shown in the attached Form.

(c) Fact of recognition;

1) On May 2004, around the time when the plaintiffs purchased the land of this case from the non-party company, "Aaa (the non-party company) sells ten parcels of land from the non-party company in the non-party company, odoo-guno-guno-do, in order to purchase ten thousand to 10,000 won. The sale price of land is 40,450,000 won at the present time, and the Civil Works Corporation has completed the purchase of land. The contractor is the first place in Korea. It is possible for the contractor to transfer the registration along with the payment of the balance." In addition, EE, a third party, sold from the non-party company the land of o-gun 204-2,00 won from the non-party company.

2) The main contents of the written statement prepared on November 4, 2016 by DNA are as follows:

In 2002, the statementer was operating bbb and aaa (non-party company) and introduced the plaintiffs through FF, an employee of the company, and sold the land of o-guno-gun multi-family housing complex in lots.

During the period between 2002 and 2003, the statementer created and sold the forest land of the oo village into a multi-unit residential complex with approximately 30 lots of land. At the time, the plaintiffs sold several lots of land to the plaintiffs, and the business funds were required in 2003, and the amount was later included in the purchase price of the instant land and settled by including it in the purchase price.

○○○○○ Village Housing Complex created about 10 lots of land and sold it to the Plaintiffs and EE. For reference, three lots of land, including o 203-1, 204-2, and 203-7, o 203-1, o 203-2, and 203-7, are land that Plaintiff BB was located in a building site with low-to-land, and GGG, the purchaser of the register, shows that Plaintiff BB sold the substitute land, and the name of the person who made the statement was unable to

○ The sale price at which the testimony was sold was KRW 400,000 to KRW 450,000 per square year. However, the actual sale price was a person who was forced to reduce the sale price, taking into account the location of the land, etc., and was sold in lots from KRW 370,00 to KRW 420,00 per square year.

The two parcels were sold to the Plaintiff AA, and one parcel was sold to the Plaintiff BB, and the three parcels was sold in the form of KRW 400,000 per square meter, and the model cargo 1 bond 7, and 204-13, a statement made to the Plaintiff AA 1 bond 1 bond 30,000 won per square meter. The building permit was planned for the long-term construction of 30 bonds because only the road was constructed only on mountain 7.

In March to April 2004, the first sales contract was made up on the basis of the following: (a) the land price was not memory for the accurate amount; (b) the total amount of three parcels was KRW 1,125,60,000, multiplied by the amount of KRW 400,000 per 2,814 square meters; and (c) on August 31, 2004, at the time of transfer of ownership registration, Plaintiff BB revised the sales contract by modifying the total amount of the land price and the construction cost to the total amount of the construction cost, while Plaintiff BB changed the sales price to the total amount of the land price and the construction cost in the sales contract.Although the date of preparation was made on April 204, it seems that the total amount of the first sales contract was modified only by the female employee, and the remainder seems to have changed to be as is, in the process of beer.

The amount of the land price was the same as the primary contract, and the construction cost was determined by the person who made the statement at the time, with the agreement to present and estimate the documents, such as various documents, such as design drawings such as civil engineering works, construction works, and sculptures for each item, and the estimate for each item.

The purchase price was partially requested from Plaintiff BB at that time, whenever the person who made a statement needed business funds (construction cost in the business site, and down payment to secure land in other business sites). The purchase price was received from Plaintiff BB at that time on several occasions, or received from the FF account, and was received as a check several times.

Although it is difficult to memory the final amount received due to the difference in the amount of ○○ purchase price received in several sequences, since the land price received prior to the registration, the registration was made, and the construction cost was received several times after the registration, and the construction cost was received several times after the registration. The construction was suspended while the construction cost was not part of the construction cost.

○ Of the total purchase price of the instant land 2,148,600,000 won, the amount actually received out of the total purchase price of the instant land seems to be 2,001,237,000 won in total of the payment statement arranged by Plaintiff BB.

3)*** a regional tax office accused the plaintiffs as a violation of the Punishment of Tax Evaders Act.* + + + the district public prosecutor’s office stated that the plaintiffs’ acquisition price of land A is KRW 1,060,737,00 according to the financial transaction details. In this case, Plaintiff AA’s transfer income tax evasion amount does not exceed x KRW 50,000,000, and the statute of limitations for tax evasion under the Punishment of Tax Evaders Act on January 22, 2013 has expired five years. The regional tax office appealed on September 9, 2016.***** + the district public prosecutor’s office appealed on June 16, 2017. The plaintiffs stated that the acquisition price of land AA is KRW 1,561,00,00,000, and that there is no other evidence to acknowledge that the plaintiffs’ real amount of land BD’s acquisition price was 1,300,000,0000,000 won, and it is found that the plaintiffs’s real amount of land acquisition price was 2.

4)** the employees of a regional tax office visited the instant land on June 20, 2016, but there was no trace of civil engineering works, etc., but there was a stable construction in the BB land, and a boundary was found between other land adjacent to Plaintiff BB land.

5) The details submitted by the Plaintiffs to arrange the amount (including the amount paid through FF of a business director of a company outside the country) that the Plaintiffs ultimately paid to DD through the prosecutorial investigation and the appeal procedure by the Tax Tribunal are KRW 2,001,237,000 as shown below.

[Ground of recognition] Facts without dispute, Gap evidence 4 through 16, Eul evidence 13 to 17 (including each number), the purport of the whole pleadings

D. Determination

1) Whether the exclusion period for imposition of ten years applies due to fraud or other unlawful act

Article 26-2 (1) 1 of the Framework Act on National Taxes, Article 38 (1) 1 of the Framework Act on Local Taxes provides that the period of exclusion of the right to impose national taxes and local taxes, in principle, is five years for the prompt determination of tax relations, but it is difficult to expect the exercise of the right to impose national taxes because it is difficult for the tax authorities to find out that there is any omission of taxes or false facts. Here, the term "Fraud and other unlawful acts" means 10 years for the imposition and collection of taxes, and it is difficult for the Plaintiffs to make a false report on the land or to make a false report on the sale price under the tax law, rather than for the following 0 days for the following reasons: (a) the new construction price of the land, including the subsequent construction price of the land, which is the 20th sale contract for the new construction of the land; and (b) the new construction price of the land, which is the 20th sale contract for the new construction of the land, which is the 20th sale price of the land.

The Plaintiffs asserts that, at the request of DD and FF, there is no clear evidence related to the instant land purchase price and construction cost, and that there is apprehension that there was no clear evidence related to the instant construction contract, it would be re-established by reflecting the construction cost in the instant land sales contract. However, in such a case, it seems ordinarily and reasonably reasonable to prepare a separate construction contract by clarifying the scope of construction to be performed and the construction cost, and without any description as to the details of construction or the construction cost as to the instant land sales contract, it seems to be very exceptional to choose a method of re-preparation by increasing the purchase price in the instant land sales contract without distinguishing the land sale price and the construction cost. Rather, in light of the fact that the Plaintiffs sold the instant land four years before the purchase price of the instant land, and the instant land was sold more than 30 bonds, and thus, it is natural to view that the Plaintiffs acquired the instant land in mind that all or part of the instant land should be sold again, and thus, it was a situation in which the instant land was evaded by including the transfer income tax in the future.

In full view of the above circumstances, the plaintiffs can be deemed to have prepared and submitted a false secondary sales contract for the purpose of evading capital gains tax by raising the acquisition value of the land of this case by including the cost of new model housing, which is unrelated to the land of this case in the purchase price of the land of this case. Thus, the plaintiffs' act is not based on a simple error, etc., but constitutes fraud or other unlawful acts to evade capital gains tax and local income tax by making it considerably difficult to impose and collect capital gains tax and local income tax significantly difficult.

Meanwhile, in a case where a certain violation of laws and regulations becomes a prerequisite for an administrative disposition, and at the same time, an administrative disposition and a punishment are different in terms of the basis, object and purpose of the administrative disposition and punishment are different from each other, so an independent administrative disposition and punishment may be imposed or imposed concurrently with regard to the same act (see Supreme Court Decision 85Nu1002, Jul. 8, 1986). Administrative trials or civil trials are not always bound by a prosecutor’s non-prosecution disposition, but are able to recognize facts opposite to the prosecutor’s non-prosecution disposition by free evaluation by evidence (see Supreme Court Decision 87Nu493, Oct. 26, 1987). Thus, even if there was a non-prosecution disposition with regard to the fact that the plaintiffs violated the Act on the Aggravated Punishment, etc. of Specific Crimes (tax) as seen earlier, such circumstance does not obstruct the court to determine that the plaintiffs’ act constitutes a case where it evaded national and local taxes by fraudulent or other unlawful act.

Ultimately, since the disposition of this case shall be subject to the exclusion period of 10 years, on the premise that the exclusion period of 5 years is applied to the disposition of this case, the plaintiffs' assertion that the disposition of this case becomes invalid due to the exclusion period of this case is without merit.

2) Whether the purchase price or conversion price of the second sales contract can be determined as the acquisition price

As seen earlier, it is recognized that the sales price stated in the second sales contract includes not only the sales price of the instant land, but also the construction price for housing and model housing, which is scheduled to be constructed on the instant land. Thus, it is evident that the sales price stated in the second sales contract cannot be deemed the actual transaction price of the instant land. Moreover, as seen in paragraph (3) below, insofar as the sales price stated in the first sales contract is recognized as the actual transaction price for the instant land, as seen in the second sales contract, it does not constitute “where it is impossible to confirm the actual transaction price at the time of acquisition” and thus, it cannot be deemed that the acquisition price of the instant land should be calculated based on the conversion price, etc. The Plaintiffs’ assertion on this part is without merit.

3) Whether the actual transaction price under the first sales contract is recognized, and whether the plaintiffs recognized the amount remitted to DoD as necessary expenses

First of all, the fact that the purchase price of the instant land (400,000 won per square year) entered in the first sale contract constitutes purely the purchase price of the instant land is supported by the DD’s written statement and the content of the sales advertisement by the non-party company. There is no special circumstance to deem otherwise false the purchase price entered in the first sale contract. Therefore, it is recognized as the actual transaction price of the instant land as KRW 852,00,000, and KRW 273,60,000,000 as stated in the first sale contract. Accordingly, the Plaintiffs’ assertion on the purchase price of the instant land is with merit within the scope of recognition as above.

On the other hand, since the tax authority bears the burden of proving the legality of taxation, the tax authority bears the burden of proving necessary expenses, in principle, as the tax authority bears the burden of proof. However, the deduction of necessary expenses is more favorable to the taxpayer, and most of the facts that form the basis of necessary expenses are located in the controlled area of the taxpayer. Thus, the tax authority has difficulty in proving it, and if it is reasonable to have the taxpayer prove it in consideration of difficulty in proving it or equity between the parties concerned, the need for proving it shall return to the taxpayer (see, e.g., Supreme Court Decision 91Nu1099, Jul. 28,

According to the facts acknowledged earlier, the sum of the amounts claimed by the plaintiffs to be paid to DD as the purchase price and the construction price of the instant land was paid for a long period from June 29, 2003 to January 28, 2006. The sum of the amounts paid before March 2004, which was before the conclusion of the instant contract, is KRW 249,180,000, and the sum paid after September 1, 2004, when the registration was completed under the names of the plaintiffs as to the instant land, is considerably included within KRW 215,950,00. In light of the above, it is highly probable that the Plaintiffs and DD had a monetary transaction based on the reasons other than the instant land, as well as the amount paid to DD, insofar as there is no evidence that the Plaintiffs paid to DD money to the said land exceeding the amount of the construction price, it cannot be readily concluded that the Plaintiffs were related to D construction price.

Therefore, although the acquisition value of the instant land is recognized as the amount under the first sales contract, the Plaintiffs’ assertion that the entire amount paid by the Plaintiffs to DD in excess of the above amount should be deducted as necessary expenses, such as the construction cost of the instant land, is without merit.

4) Whether disposition of local income tax of this case is unlawful

According to the purport of Eul evidence Nos. 1 and 2 and the whole arguments, since "local income tax" was newly established on the items of Articles 5 and 6 of the former Local Tax Act (amended by Act No. 9924, Jan. 1, 2010; hereinafter the same shall apply) after being amended by Act No. 10416, Dec. 27, 2010. This purport is to consolidate the income tax to be imposed on the income before the amendment and the business place tax to be imposed, and it is recognized that the substance, table, tax rate, imposition system, etc. were the same as that of the existing resident tax, but only the name and tax item were changed to the local income tax. Furthermore, since Article 4 of the Addenda of the Local Tax Act (amended by Act No. 9924, Jan. 1, 2010; hereinafter the same shall apply) as the acquisition value of land of this case calculated on the first time after the enactment of the above Act, the disposition of transfer income tax of this case is imposed on the plaintiff No. 16.

(e) Calculation of a legitimate tax amount;

The acquisition value based on the actual transaction value of the instant land should be recognized as KRW 400,000 per square day, and in such a case, the reasonable tax amount is as indicated below (see, e.g., the Defendant’s reference document in June 20, 2018). Of the instant disposition, the part exceeding the stated “justifiable tax amount” stated below should be revoked in an unlawful manner. The Plaintiffs’ assertion is reasonable within the scope of the above recognition.

3. Conclusion

Therefore, the plaintiffs' claims against the defendants are accepted within the scope of the above recognition, and the remaining claims are dismissed as they are without merit. It is so decided as per Disposition.