Examination Income 2015-0052 ( November 03, 2015)

The Defendant’s calculation of the total amount of the Plaintiff’s interest income cannot be deemed as having fulfilled the burden of proof.

The Defendant’s burden of proof cannot be deemed to have fully assessed the total amount of the instant subscription on the ground that it was an interest income accrued from credit business without taking measures to deduct and reflect it from the total amount of the income by investigating the details of specific rental principal or interest payment, and the small amount of deposits that cannot be seen as interest income.

Article 80 of the Income Tax Act shall be decided and corrected.

2016Guhap52910 global income and revocation of such disposition

KimA

BB Director of the Tax Office

October 25, 2016

November 24, 2016

1. On April 22, 2015, the Defendant revoked the disposition of imposition of an OO of global income tax for the Plaintiff on April 22, 2015.

2. The costs of the lawsuit are assessed against the defendant.

Cheong-gu Office

As set forth in the text.

1. Details of the disposition;

A. The Plaintiff, as set out in attached Table 1, operated a credit business under the trade name, i.e., "CCC" from OO-dong O-O to January 1, 2005, and from OO-dong O-O to July 30, 201. From May 28, 2009 to December 16, 2009, the Plaintiff operated a used car retail business under the trade name, i.e., "D" from OO-dong O-O, to O-dong, and operated a used car retail business at the same place from November 27, 2009 to February 29, 2012.

[Attachment 1] Total Business Contents of the Plaintiff

B. From June 25, 2013 to September 2, 2013, the head of XX tax office conducted an investigation into the source of funds against the Plaintiff. During that process, the head of the relevant tax office confirmed the deposit details in 2009, 2010 of the five bank accounts under the name of the Plaintiff (hereinafter referred to as “each of the instant accounts”) (the deposit details in 2009 among them are the same as attached Table 2), and notified the data for taxation in the YP book, the competent tax office of the EE, by deeming that the financial transaction was conducted in relation to the EE’s business.

C. YYari’s defect in the request for explanation against the Plaintiff regarding the details of deposits in the year 2009 for each of the instant accounts (hereinafter “instant taxation data”), and the Plaintiff explained to the effect that each of the instant accounts is irrelevant to EE and D and is related to CCC by credit business chain. Accordingly, the Y director of the tax office having jurisdiction over the Plaintiff’s domicile notified the Defendant, who is the tax office having jurisdiction over the Plaintiff’s domicile, of the instant taxation data.

D. On April 22, 2015, based on the taxation data of the instant case, the Defendant deemed that the sum of the inputs of each of the instant accounts in 2009 (hereinafter “instant inputs”) was omitted from the CCC’s revenue amount, and issued a disposition of imposition of the global income tax OOs for the Plaintiff in 2009 (hereinafter “instant disposition”).

E. On June 29, 2015, the Plaintiff filed a request for review with the Commissioner of the National Tax Service on the instant disposition, but the said request was dismissed on November 3, 2015.

[Ground of recognition] Unsatisfy, Gap evidence 1 to 3, Eul evidence 1 to 5

each entry and the purport of the whole of the arguments.

2. Whether the instant disposition is lawful

A. Summary of the plaintiff's assertion

First, even though the director of the Seoul Regional Tax Office has already conducted and completed a tax investigation against the plaintiff around 2010, it is illegal to conduct another tax investigation on the same tax item and taxable period with the plaintiff around 2013 as it constitutes a duplicate tax investigation prohibited by Article 81-4(2) of the Framework Act on National Taxes.

Second, the amount of the instant input should be excluded from interest income, and a considerable portion of the remainder except the leased principal should be excluded from interest income, as the Plaintiff was paid from the endr of the used vehicle with automobile repair fees, etc. and paid to others. However, the Defendant calculated the total amount of the instant input by deeming it as interest income in light of the total amount of the instant input to be the interest income is unlawful in violation of the principle of taxation based on the ground.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) Whether it constitutes an illegal duplicate tax investigation, etc.

A) Facts of recognition

(1) From April 1, 2010 to May 13, 2010, the director of the Seoul Regional Tax Office (hereinafter “the first tax investigation of this case”) found that the Plaintiff, while conducting a credit business with the FF and lending money to the borrower without registering its business in 2005 to 2009, without reporting the amount of interest of 20-49% of the leased principal, omitted from the reported amount of interest to the OOOO in the form of borrowing money from the borrower. In doing so, the director of the Seoul Regional Tax Office (hereinafter “the first tax investigation of this case”) found that the Plaintiff did not report the amount of interest accrued in 2005-208 and notified the tax office having jurisdiction over the amount of income accrued in 209 for which the reporting period has yet to elapse, after notifying the borrower of the data.

(2) In addition, the head of XX tax office requested the Plaintiff to vindicate the acquisition fund relating to the real estate acquired by the Plaintiff during the period from 2007 to 2010, and to verify that the source of the fund is unclear only by the supporting documents of the Plaintiff’s submission, the Plaintiff conducted an investigation on the gift tax for the year 2007 to 2010 (hereinafter “the second tax investigation of this case”) with respect to the Plaintiff from June 25, 2013 to September 2, 2013, and the Plaintiff reported and paid the amount of the fund after the deadline on the Plaintiff’s donation to his father and other persons.

(3) However, in the process of the secondary tax investigation of this case, each of the instant accounts and the details of deposits in the year 2009, 2010 were revealed. Accordingly, the head of XX tax office notified the instant taxation data to the YY Tax Office, which is the competent tax office of the EE, by deeming that the financial transaction was conducted in relation to the EE business of the Plaintiff’s operation.

(4) Based on the instant taxation data, the Y director of the tax office requested the Plaintiff to issue an order for taxation data on the instant input amount, which was the input amount in 2009, when processing the tax by deeming the EE’s omission in the sales declaration for the amount of 2010 taxable year based on the instant taxation data. On December 17, 2014, the Plaintiff prepared a written confirmation to the head of the YY Tax Office to the effect that “each of the instant accounts is irrelevant to EE and D and is related to CCC, and value-added tax is not at issue.”

(5) Accordingly, the director of the Y Tax Office determined that the pertinent input amount constituted the amount of CCC (individual entrepreneurs) operated by the Plaintiff, and notified the Defendant, who is the tax office having jurisdiction over the Plaintiff’s domicile, of the instant taxation data. On April 22, 2015, the Defendant rendered the instant disposition against the Plaintiff based on the said taxation data.

[Ground of recognition] Unsatisfy, Gap evidence 8, Eul evidence 1 to 5, Eul evidence 6-1

Re-appeal and the purport of the whole pleading

B) Determination

(1) The term “tax investigation” refers to questioning in order to determine or correct the tax base of national tax and the amount of tax, or inspecting, investigating, or ordering submission of, the relevant account books, documents, or other articles (Article 81-2(2)1 of the former Framework Act on National Taxes). Such tax investigation is a kind of administrative investigation to realize the State’s right to taxation. The main text of Article 81-4(2) of the Framework Act on National Taxes stipulates the principle of prohibition of double investigation by stipulating that a re-investigation cannot be conducted for the same tax items and taxable periods to minimize the restriction on taxpayers’ fundamental rights based on the principle of excessive prohibition under the Constitution and the due process of law. However, the Framework Act on National Taxes stipulates that a re-investigation may be conducted exceptionally in cases where there is clear evidence to acknowledge suspicion of tax evasion” under Article 81-4(2)1 of the Framework Act on National Taxes refers to cases where it is acknowledged by objective and rationality materials from the previous tax investigation (see, e.g., Supreme Court Decision 201Du19482, Feb. 19, 20197).

(2) As seen in the above facts, the first tax investigation by the director of the Seoul Regional Tax Office on the instant case was conducted on the Plaintiff’s credit business in 2005-2009. On the other hand, the second tax investigation by the director of the XX tax office on the Plaintiff’s source of funds to purchase real estate in 2007-2010, which is a gift tax investigation on the Plaintiff’s source of funds to purchase real estate in 2007-2010, and its tax items and contents are different from each other. Thus, the second tax investigation by the director

On the other hand, the head of the Y Tax Office's request for explanation of taxation data against the plaintiff on the basis of the taxation data of this case constitutes "an inquiry or an order to submit the pertinent documents" under Article 81-2 (2) 1 of the Framework Act on National Taxes in order to determine the tax base and tax amount of national tax. However, in full view of the above facts of recognition and evidence No. 7, the part concerning the plaintiff's two of the taxation data of this case, among the taxation data of this case, was verified at the time of the first tax investigation of this case. However, the remaining part of the taxation data of this case except the two of the above GG bank account in this case, which was revealed only during the second tax investigation of this case. It is acknowledged that the plaintiff, who was engaged in the credit business and used the used car transaction business, was about the deposit details of the account in 2009 under the name of the plaintiff who was not reported to the tax authority. In light of the above legal principles, the part concerning the above plaintiff's taxation data of this case as the above can not be acknowledged as evidence or evidence of tax evasion.

Therefore, it is reasonable to view that the request of the director of the Y Tax Office for the explanation of taxation data against the Plaintiff constitutes a duplicate tax investigation prohibited under Article 81-4(2) of the Framework Act on National Taxes within the scope of investigation as to two parts of the above Plaintiff's GG bank account among the taxation data of this case, and it constitutes a duplicate tax investigation permitted within the scope of investigation of the remaining parts. Therefore, the Plaintiff's assertion

2) Whether the calculation of the total amount of income is contrary to the underlying taxation principle

A) Article 24(1) of the Income Tax Act provides that "the total amount of income of a resident shall be the sum of the amounts received or received in the pertinent taxable period." Article 16(1) of the Framework Act on National Taxes provides that "where a person liable for tax payment keeps and enters a book under the tax-related Acts, the investigation and decision of the tax base of the relevant national tax shall be based on the book kept and recorded and related documentary evidence," and Article 80(3) of the Income Tax Act provides that "where the head of the district tax office having jurisdiction over the place of tax payment or the director of the regional tax office determines or revises the tax base and amount of tax in the corresponding year pursuant to the provisions of paragraphs (1) and (2) of this Article, the burden of proving the total amount of income shall be based on the book and other documentary evidence."

B) In light of these legal principles, we examine whether the Defendant’s calculation of the total amount of the Plaintiff’s interest income can be deemed to have fulfilled the burden of proof.

Comprehensively taking account of the overall purport of the statements and arguments set forth in Gap evidence Nos. 4 through 7, Gap evidence Nos. 9, and Gap evidence No. 10 (including each number number), and the whole purport of the arguments, the following facts are as follows: ① When the plaintiff extended the purchase price of a used car to the ender of a used car, it purchased used cars with the money and subsequently changed the name of the vehicle in the name of the plaintiff later; ② the principal of the lease, the period of the lease, the interest rate of the loan, etc. are not discovered; ② The plaintiff's account books and loan agreements, etc. are not discovered; ③ the fact that the money amounting to KRW 00,000,000,000,0000,0000 won from the used car is deposited from the end of each of the instant accounts; ④ The plaintiff's account among each of the instant accounts, it is recognized that the vehicle model and vehicle number (e.g., "low-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-

In light of the Plaintiff’s lending method and amount, etc. revealed in the above recognition, deeming that the Plaintiff included not only the interest that the Plaintiff was paid from the used vehicle with respect to money deposited in each of the instant accounts, but also the principal thereof, accords with the empirical rule. Moreover, in light of the details and amount of the depositor’s column, it is highly probable that the Plaintiff was paid repair expenses, etc. from the lessee in advance, as alleged by the Plaintiff, and subsequently paid them to the repair company, etc., it is difficult to conclude that the Plaintiff was interest income from the Plaintiff’s credit business. However, it is difficult to conclude that the Defendant was an interest income from the Plaintiff’s credit business, on the ground that the Plaintiff did not discover the Plaintiff’s account book or loan agreement regarding the leased principal, loan period, interest rate, etc., and the small amount of money difficult to be deemed as interest income, and did not take measures to deduct and reflect the payment details of the leased principal, interest payment details, etc. from the total amount of income, and calculated the total amount of the instant deposited money as interest income from credit business.

The defendant asserts that the plaintiff bears the burden of proof as to the existence of the leased principal, but inasmuch as the defendant bears the burden of proof as to the existence of the total amount of income, the rule of experience, which can be seen as the interest income, can either be viewed as the existence of or can be seen as such. The defendant can bear the burden of proof as to the existence of principal, only in a case where the defendant proves considerable degree of proof, which does not fall under

D. Sub-committee

The instant disposition is unlawful.

3. Conclusion

Therefore, the plaintiff's claim is reasonable, and it is decided as per Disposition.