Income tax liability of workers working for overseas local corporations;

It is reasonable to view that the Plaintiff constitutes a “resident” under the former Income Tax Act in 2011, because it is difficult to view that the Plaintiff’s continued to reside abroad under Article 2(4)1 of the former Enforcement Decree of the Income Tax Act and has an occupation that requires ordinary residence abroad for at least one year.

2015Guhap71540 global income and revocation of disposition thereof

Park ○

Head of the tax office

June 29, 2016

August 31, 2016

1. The plaintiff's claim is dismissed.

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

Cheong-gu Office

The Defendant’s disposition of imposing global income tax of KRW 403,172,250 on the Plaintiff on June 10, 2015 is revoked.

1. Details of the disposition;

A. From August 30, 2007, the Plaintiff is a person who had worked as a consortium with the company (hereinafter referred to as the “non-party company”) from around 30, 2007 to Senior Conult.

B. Notwithstanding the Plaintiff’s “resident” under the former Income Tax Act (amended by Act No. 12852, Dec. 23, 2014; hereinafter the same), the Defendant determined that the Plaintiff omitted the return of global income tax on KRW 885,211,251, which was received from the Nonparty Company in 2011; and on June 10, 2015, the Defendant determined and notified the Plaintiff of KRW 403,172,250, global income tax for the year 201 (hereinafter “instant disposition”).

C. The Plaintiff dissatisfied with the instant disposition and filed an appeal on July 10, 2015, but the Tax Tribunal dismissed the Plaintiff’s claim on September 22, 2015.

[Ground of recognition] Facts without dispute, Gap evidence 1-1, 2, Gap evidence 2, 3, Eul evidence 1, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The plaintiff constitutes "a person with an occupation that requires him/her to reside in a foreign country for at least one year," and thus, the plaintiff should be deemed to have no address in Korea pursuant to Article 2 (4) 1 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 26067, Feb. 3, 2015; hereinafter the same shall apply). The disposition of this case based on the premise that the plaintiff is a "resident" under the former Income Tax Act is unlawful.

(b) Related statutes;

It is as shown in the attached Table related statutes.

(c) Fact of recognition;

1) On January 7, 2008, the Plaintiff and the spouse of the Plaintiff maintained their resident registration until now since they moved the head of ○○○-dong, ○○○-dong, which is owned by the Plaintiff, into the Plaintiff. The Plaintiff’s spouse continued to live in the above domicile, and the Plaintiff’s spouse resided in the above domicile when he stays in Korea.

2) From 2007 to 2011, the number of days of stay in the Republic of Korea of the Plaintiff and the Plaintiff’s spouse and children (the date of June 26, 1984 and November 6, 1986) are as follows.

3) The details of the Plaintiff’s business in Korea since 1998 are as follows.

4) At the time of the instant taxable year, the Plaintiff: (a) held ○○○○○○-dong 72514-1/3 shares; and (b) purchased ○○-dong 70 shares of ○○ Insurance Co., Ltd. on December 30, 201; (c) on January 25, 2012, 702, ○○-dong ○○○○-dong ○○○○○-dong ○○○○ ○○ ○○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ 4, 2012, respectively, acquired ○ 701 shares (acquisition acquisition value:68,00,000).

5) On August 30, 2007, the Plaintiff entered into a one-year employment contract with the non-party company and worked in the non-party company until 2015 while extending the annual contract period. The Plaintiff was provided with local vehicles, accommodation, etc. from the non-party company. Of the benefits received from the non-party company, the Plaintiff remitted all the remaining money used in Kuwait to Korea, and there was no tangible asset owned in Kuwait, and there was no income tax from Kuwait.

6) The Plaintiff stayed in the Republic of Korea during the period from January 26, 2011 to February 5, 2011; from June 3, 2011 to June 26, 2011; from September 30, 2011 to October 21, 201; from November 24, 2011 to December 6, 2011; and from December 23, 2011 to December 31, 2011, the Plaintiff stayed in the Republic of Korea for a period of time from December 23, 2011 to December 31, 2011. The most of the periods among them were under a business trip order issued by a non-party company related to its domestic business.

[Ground of Recognition] Facts without dispute, Gap evidence 1-2, Gap evidence 2-4, Eul evidence 9-14-17, Eul evidence 2-2, Eul evidence 3-1, 2, Eul evidence 4, the purport of the whole pleadings

D. Determination

1) Relevant legal principles

The term "resident" under Article 1-2 (1) 1 of the former Income Tax Act means a resident who has his/her domicile in the Republic of Korea or has

Article 2 (1) of the former Enforcement Decree of the Income Tax Act provides that "when a person has a residence and a family living together in Korea and a family living together in Korea are judged according to objective facts of living relations, such as the existence of assets located in Korea," Article 3 (3) 2 provides that "when a person has a family living together in Korea and is deemed to live in Korea for not less than one year in view of his occupation and property status, he shall be deemed to have a domicile in Korea." Meanwhile, Article 2 (1) of the former Enforcement Decree of the Income Tax Act provides that "when a person has an occupation which requires him to reside in a foreign country for not less than one year, he shall be deemed to have

Therefore, whether a person is a resident under the Income Tax Act, i.e., a person having a domicile in the Republic of Korea should be determined by comprehensively taking into account the objective facts of living relations, such as whether a family living together in the Republic of Korea exists, whether a person has an asset located in the Republic of Korea, and occupation. Furthermore, the Income Tax Act only stipulates that an objective living relationship in the Republic of Korea should be comprehensively considered when determining an individual's identity is determined, and the living relationship in the other country is not considered as a comparative determination factor, and it is promoting a resolution through a tax treaty, etc. in preparation for cases where both residents are recognized, it should be determined as a domestic resident on the basis of a living relationship in the Republic of Korea, and it should not be determined by mainly taking into account the living relationship such as overseas activities and holding assets (see Supreme Court

2) In the instant case:

In this case, the following circumstances are revealed: (a) the Plaintiff’s resident registration in the apartment house owned by the Plaintiff in Korea along with his spouse in the instant taxable year; (b) the Plaintiff’s spouse stayed in Korea for 77 days in total; (c) the Plaintiff’s spouse stayed in Korea for 353 days in most of annual periods; (b) the Plaintiff’s children were staying in Korea during the instant taxable year; (c) the Plaintiff did not own tangible assets within Kuwait; (c) the Plaintiff transferred most of the income accrued from Kuwait to Korea; (d) the amount was used as the living expenses of the Plaintiff and his family members; and (e) the amount was deemed to have been financed by assets such as real estate and vehicles owned by the Plaintiff; and (e) the Plaintiff obtained rental income from the year 2012 after being registered as a rental business operator for the real estate acquired after the instant taxable year; and (iv) the Plaintiff entered into an employment contract for 1 year with a non-party company on a yearly basis; and therefore, (e) the Plaintiff’s children were in Korea’s business over two years.

The plaintiff's assertion is without merit.

3. Conclusion

The plaintiff's claim of this case is dismissed as it is without merit, and it is so decided as per Disposition.