As long as real estate leasing services are supplied, whether the actual payment has been made or not shall not affect the establishment of the liability for value-added tax payment.

Since the lessee agreed to receive rental deposit and rent from the lessee in return for the provision of real estate rental services, the lessee is liable to pay value-added tax during the lease period even if he/she was not paid the rent.

Supply of services under Article 2 of the Value-Added Tax Act

2014Guhap19056 Nullification of Notice of Imposition of Rental Income Tax

KoreaA

Head of the Do Tax Office

March 27, 2015

April 3, 2015

1. All of the plaintiff's claims are dismissed.

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

Cheong-gu Office

On January 4, 2010, the defendant confirmed that the imposition of the value-added tax for the plaintiff on January 4, 2010, OO(including the additional tax), OO(including the additional tax), 2007, OO(including the additional tax), 1, 2008, O(including the additional tax), 2008, OO(including the additional tax) and OO(including the additional tax) for the first time in 2009 is null and void.

1. Details of the disposition;

A. On December 8, 2006, the Plaintiff completed the registration of transfer of ownership with respect to ten bonds (hereinafter referred to as "each commercial building of this case"). On April 1, 2007, the Plaintiff transferred each commercial building of this case to B from March 25, 2007 to March 24, 2012, each of the commercial buildings of this case was leased by setting the deposit OOO, the rent monthly OO (the last day of the relevant month calculated from the commencement date of the business after completing the facility construction) and the lease period from March 25, 2007 to March 24, 2012. At that time, each of the commercial buildings of this case was delivered to B.

B. Around April 28, 2007, after completion of the construction of the interior facilities of each of the instant commercial buildings, the BB opened and operated the relevant restaurant in the name of “CCC,” from February 10, 2010, and operated the relevant restaurant from February 11, 201 to December 15, 201.

C. Meanwhile, as the Plaintiff did not report the business registration and the value-added tax on the leased income, the Defendant, ex officio on October 8, 2008, filed the business registration for the Plaintiff on April 8, 2007, and the Plaintiff was deemed to have closed the business on the same day on June 16, 2010, and revoked the said business registration.

D. Each of the instant commercial buildings was sold to ChoE, ParkF, Chog, and Cho H on April 20, 2010, when the voluntary auction procedure with respect to each of the instant commercial buildings was in progress.

E. From May 2007 to June 4, 2009, the Defendant imposed dispositions on the Plaintiff on January 4, 2010 on the imposition of the annual rent and the amount equivalent to interest on the said deposit, including the total amount of the value-added tax and the additional tax (the total amount of the additional tax that is not issued by tax invoice, the additional tax that is not filed, and the penalty tax that is not paid in good faith; hereinafter the same shall apply), the total amount of the value-added tax and the additional tax for the second period of 2007, OO, the total amount of the value-added tax and the additional tax for the first period of 2008, OOO, the total sum of the value-added tax and the additional tax for the second period of 208, OOO, and the total sum of the value-added tax and the additional tax for the first period of 209 (hereinafter the “each taxation disposition”).

[Reasons for Recognition] Unsatisfy, Gap evidence 1 to 6, Eul evidence 1 to 9 (including each number in case of a tentative number), the purport of the whole pleadings

2. Whether each taxation of this case is legitimate

A. The plaintiff's assertion

B From April 4, 2007, the Plaintiff did not pay rent to the Plaintiff at all upon the commencement of the auction procedure for each of the instant commercial buildings from April 30, 2008. Therefore, each of the instant taxation dispositions based on the premise that the Plaintiff supplied real estate leasing services, even though there was no supply of real estate leasing services, is serious and obvious.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

A person who independently supplies goods or services is liable to pay value-added tax [Article 2(1) of the former Value-Added Tax Act (amended by Act No. 9268 of Dec. 26, 2008; hereinafter referred to as the "former Value-Added Tax Act]; the time when the services are supplied is the time when the services are supplied or the goods, facilities, or rights are used (Article 9(2) of the former Value-Added Tax Act). Thus, as long as the services are supplied to another person, the issue of whether the services have been actually received may not affect the establishment of the liability for the payment of value-added tax or the time of supply of the services (see, e.g., Supreme Court Decisions 87Nu863, Apr. 25, 1989; 94Nu146, Nov. 28, 1995).

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit. It is so ordered as per Disposition.

The decision shall be rendered as above.