Whether a decision of estimation is legitimate

Even if an on-site investigation is conducted by taking measures to point out the illegality of evidence and to require the submission of new materials, it is legitimate to calculate by means of the estimation survey.In addition to the fact that the income tax can impose an additional tax on under-reported return for two or more places of business, it is not possible to impose an additional tax on

Article 80 of the Income Tax Act

Suwon District Court 2016Guhap62918 (2017.08)

J**

○ Head of tax office

November 23, 2016

2017.02.08

1. On January 4, 2016, the Defendant’s imposition of penalty tax of KRW 11,716,623, the amount exceeding KRW 6,479,224, among the imposition of penalty tax of KRW 11,716,623, imposed against the Plaintiff for the year 2014

2. The plaintiff's remaining claims are dismissed.

3. 9/10 of the costs of lawsuit shall be borne by the Plaintiff, and the remainder by the Defendant, respectively.

The imposition of global income tax of 13,402,210 won (including additional tax), global income tax of 2013,373,840 won (including additional tax), global income tax of 2013, global income tax of 2013, and global income tax of 89,209,730 won (including additional tax) for 2014 shall be revoked on January 4, 2016.

1. Details of the disposition;

A. On June 25, 2012, the Plaintiff registered his/her business with the trade name called "a design", and closed the said private teaching institute on June 30, 2015, when the Plaintiff registered his/her business with the trade name called "a design" and "bdesign" and registered his/her business with the trade name called "a design" and "abdesign" on July 18, 2014.

B. Around November 2015, the head of the Songpa District Tax Office found that the Plaintiff, with respect to each business listed in the foregoing paragraph (a) (hereinafter referred to as “each business of this case”), filed an integrated tax investigation with the Plaintiff, omitted returns of the total amount of KRW 327,281,818 won, total of the income in 2012, total of KRW 940,350,214, total of the income in 2013, and KRW 918,039,204, total of the income in 2014, on the basis of the income determined by estimation as standard expense rate for each of the above taxable years, and notified the Defendant of the total income in 2012, including KRW 13,402,210 (including additional taxes), global income tax in 2013, KRW 133,373,840 (including additional taxes), global income tax in 2014, KRW 89,730 (including additional taxes).

C. Accordingly, on January 4, 2016, the Defendant imposed on the Plaintiff the global income tax of KRW 13,402,210 (including additional tax), global income tax of KRW 13,373,840 (including additional tax), global income tax of KRW 133,373,840 (including additional tax), global income tax of KRW 89,209,730 (including additional tax) for the year 2013 (hereinafter “the instant first disposition” through “the instant three dispositions”).

[Ground of recognition] Facts without dispute, Gap evidence 1 to 3, Eul evidence 1 to 3, the purport of the whole pleadings

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

A. The plaintiff's assertion

1) The Defendant, despite the account books available for on-site investigation, has committed an error in determining the amount of income by means of the estimation survey in each disposition of this case, and even in the method of estimation investigation, there was a lack of rationality and feasibility by recognizing only part of the purchase cost, rent, labor cost, and the administrative fine, management fee, transportation cost, advertising cost, and communication cost, etc.,

2) In the instant disposition 3, the Defendant calculated and imposed both general non-reported and general under-reported additional taxes on the Plaintiff.

(b) Related statutes;

It is as shown in the attached Table related statutes.

C. Determination

1) Whether it is legitimate to calculate the amount of income by means of estimated survey

A) Article 80(3) of the former Income Tax Act (amended by Act No. 12852, Dec. 23, 2014; hereinafter the same) provides that “Where the head of a regional tax office or the director of a regional tax office having jurisdiction over the place of tax payment determines or revises the tax base and the amount of tax in the relevant taxable period pursuant to paragraphs (1) and (2), he/she may determine or correct the amount based on the account books and other evidentiary documents: Provided, That where it is impossible to calculate the amount of income by means of account books or other evidentiary documents on the grounds prescribed by Presidential Decree, he/she may determine the amount of income by estimation, as prescribed by Presidential Decree,” and Article 143(1)1 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 26982, Feb. 17, 2016; hereinafter the same) provides that “where necessary account books and evidential documents are not available or important parts are incomplete or false in calculating the amount of tax”

In light of the fact that: (a) the Plaintiff’s tax base and tax amount were inappropriate; (b) the Plaintiff’s tax office’s submission of tax invoices, account books, and other evidence; (c) the Plaintiff’s submission of new tax invoices to the Plaintiff; (d) the Plaintiff’s submission of new tax invoices to the Plaintiff; and (e) the Plaintiff’s submission of new tax invoices to the Plaintiff; and (e) the Plaintiff’s submission of new tax invoices to the Plaintiff for the tax base and tax amount to the Plaintiff; and (e) the Plaintiff’s submission of new tax invoices to the Plaintiff for the tax base and tax amount to the Plaintiff; and (e) the Plaintiff’s submission of new tax invoices to the Plaintiff for the tax base and tax amount to the Plaintiff; and (e) the Plaintiff’s submission of new tax invoices to the Plaintiff for the tax base and tax amount to the Plaintiff; and (e) the Plaintiff’s submission of new tax invoices for the tax base and tax amount to the Plaintiff for the tax base and tax amount to KRW 1 to 2, 15-4, and 17, respectively.

2) Whether the calculation of the income amount by the method of the estimation was lawfully made

A) Article 143 (3) 1 of the former Enforcement Decree of the Income Tax Act provides that "Where the amount of income is estimated, or revised pursuant to the proviso to Article 80 (3) of the Act, the amount paid or payable by the documentary evidence as the purchase cost and the rent for fixed assets for business; (b) the amount paid or payable by the documentary evidence as the wages and retirement pay for employees; (c) the amount obtained by deducting the amount calculated by multiplying the amount of income by the standard expense rate shall be determined or revised as the amount of income; (5) the scope of purchase expenses under Article 143 (3) 1 (a) of the former Enforcement Decree of the Income Tax Act and the types of documentary evidence under items (a) and (b) of the same subparagraph shall be determined by the Commissioner of

The National Tax Service Notice (No. 2010-16, hereinafter referred to as the "Notice of this case") provides that "purchase costs and rent for fixed assets for business should be objectively verified by documentary evidence, such as tax invoices, invoices, credit card sales slip (including current gold receipt), and employees' benefits, wages, and retirement benefits should be objectively verified by documentary evidence, such as wage withholding receipt, retirement income withholding receipt, or payment record."

B) In the instant case, with respect to the purchase cost, rent, and personnel expenses claimed by the Plaintiff to be omitted, the Plaintiff did not submit all documentary evidence, such as the tax invoice, invoice, credit card sales slip (including cash receipts), withholding receipt for wage and salary income, retirement income withholding receipt, or payment record as stated in the instant notice, and each statement in Gap evidence 15-1 through 4, Gap evidence 16-1 through 3, Gap evidence 17, and 18-1, and 2 is insufficient to recognize that the Plaintiff paid purchase cost, rent, and personnel expenses in excess of the amount recognized by the Defendant. Since there is no other evidence to support otherwise, the Defendant’s measure that did not deduct the amount is justifiable. Moreover, the part of the Plaintiff’s claim that does not fall under Article 143(3)1(a) and (b) of the former Enforcement Decree of the Income Tax Act (including administrative fine, management fee, transportation expense, advertising expense, and communication expenses) is included in the amount calculated pursuant to the said item, and there is no need to separately consider the amount of the Plaintiff.

3) Whether the imposition of additional tax is illegal

A) Unlike the value-added tax that has a duty to report and pay as a unit of workplace, income tax is an individual as a unit of taxation (see Articles 2(1), 4(1), and 19(2) of the Income Tax Act, and cannot be deemed as having a duty to report and pay as a unit of workplace on the ground that there are two or more workplaces. Therefore, even if a taxpayer’s report of income tax was made only on some business places, the amount equivalent to the total amount of omitted income may not be subject to the general penalty tax under Article 47-2(1) of the former Framework Act on National Taxes (amended by Act No. 12848, Dec. 23, 2014; hereinafter the same) on the calculated tax amount equivalent to the total amount of omitted income.

In this case, in full view of the purport of the arguments in the statement No. 1-3 and No. 1-3 and No. 3, the plaintiff filed a report on only part of the income amount of 'bB design' and 'cccc sc sc sc sc s at the time of filing the global income tax for the year 2014. With respect to global income tax for the plaintiff for the year 2014, the defendant imposed an amount of tax equivalent to the total of 367,371,332 won (b design 249,206,727 + ccc sc s 117,768,605 won + cc s sc s s 117,768,605 won) of the total amount of income omitted from the report amount of 'b design' and 'general sc sc s s sc s s s s s s s s s s s s s s s s s s.

However, the Plaintiff is obligated to pay for underreporting the amount of tax equivalent to the amount of tax on the amount of tax on the amount of tax on the amount of tax on the amount of tax on which the return was omitted at least. In addition to the purport of the argument in subparagraph 3, the Plaintiff’s general underreporting penalty tax on the amount of tax on the amount of tax on the amount of tax on the said omitted return may be recognized as constituting 5,237,399. Thus, the Defendant’s imposition of penalty tax on the amount of tax on the global income of KRW 11,716,623 against the Plaintiff on January 4, 2016 exceeds KRW 6,479,224 ( KRW 1,241,825 + KRW 5,237,39) from among the imposition of penalty tax on the amount

B) Meanwhile, in this lawsuit, the Defendant asserts that the Plaintiff’s imposition of penalty tax on an indefinite term penalty tax under Article 81(8) of the former Income Tax Act (20% of the calculated tax amount) exceeds KRW 11,716,623 of the initial penalty tax imposed by the Defendant, on the ground that the Plaintiff added it to the grounds for disposition that the indefinite term penalty under Article 81(8) of the former Income Tax Act is subject to imposition of tax (20% of the calculated tax amount) and thus, the imposition of penalty tax on the three disposition of this case is lawful.

On the other hand, inasmuch as the subject matter of a lawsuit seeking revocation of a taxation exists objectively, the tax authority may submit new data that can support the legitimacy of the tax base or amount of tax recognized in the relevant disposition, or exchange and change the reasons within the scope that maintains the identity of the disposition (see, e.g., Supreme Court Decision 2001Du1994, Oct. 11, 2002). However, the absence of a tax return under Article 47-2(1) of the former Framework Act on National Taxes is imposed on the "where the taxpayer fails to report the tax base of national tax by the statutory due date of return." On the other hand, the absence of a tax return under Article 81(8) of the former Income Tax Act (excluding a small-scale business operator prescribed by Presidential Decree) or the amount of tax to be kept and recorded in the books under Articles 160 and 161, and even if the amount of tax to be imposed on the Plaintiff is less than the amount to be imposed on the books, it cannot be seen as an independent tax return within the same scope of the Defendant's.

3. Conclusion

The plaintiff's claim is justified within the scope of the above recognition, and the remainder is dismissed as it is without merit. It is so decided as per Disposition.