[Request Number] Trial 2017 Jeon 4036 ( November 21, 2017)

[P] Rejection of Global Income [Type of Decision]

[Summary of Decision] The issue of the National Tax Refund on the petitioner is that the existence and scope of the national tax refund has already been determined pursuant to Article 51(1) of the Framework Act on National Taxes, and that the petitioner only filed a return after the deadline and does not submit an application for national tax refund in a regular manner. Thus, the appeal constitutes an unlawful claim without a disposition that is the object of appeal

[Related statutes] Article 31 of the Framework Act on National Taxes / Article 55 of the Framework Act on National Taxes

[Reference Decision] High Court Decision 1990Du0328

The appeal shall be dismissed.

1. Summary of disposition;

A. From January 1, 2016 to June 30, 2016, the claimant served at the OOO Co., Ltd., and the OOO paid the benefits after withholding the earned income tax OO for the above period.

B. On July 3, 2017, the claimant filed a return of the global income tax for the year 2016 with the head of the OO head of the tax office after the due date, and filed a return exceeding the OO of the global income tax (hereinafter “instant national tax refund”).

C. On August 17, 2017, the OO seized the issue of the national tax refund based on the delinquent amount of local taxes, such as automobile tax of the claimant. On August 30, 2017, the OOO chief notified the claimant of the seizure of the national tax refund and paid the issue of the national tax refund to the OO.

D. The claimant appealed and filed an appeal on August 24, 2017.

2. Opinions of the claimant and disposition agency;

A. The claimant's assertion

(1) The key issue is that the national tax refund is a wage claim that limits the seizure under Article 33 of the National Tax Collection Act, and that the National Tax Service should limit the seizure (tax imposition-102, November 4, 2010), namely, the seizure of OO is null and void.

(2) Nevertheless, it is illegal that the head of the OOO tax office did not pay the national tax refund to the claimant because it is an illegal administrative process that the head of the OOO tax office paid the national tax refund to OO based on the invalid seizure of the national tax refund to the claimant.

(b) Opinions of disposition agencies;

(1) The OOO served a notice of claim attachment on the issue of the national tax refund to the head of the OOO, the garnishee, and the effect of the claim attachment by the head of the OOOO on August 17, 2017 upon receipt of the notice of claim attachment occurred. Accordingly, the OO director only paid the national tax refund to the OO, the execution creditor, in accordance with Rule 51-012 of the Framework Act on National Taxes.

(2) The attachment of the amount equivalent to the local tax in arrears is not an OO tax secretary, but an OOO, the head of a local government, must notify the applicant of the fact pursuant to Article 51 of the Local Tax Collection Act. As the claimant's assertion, whether the national tax refund seizure is illegal or not is merely an OO's determination.

3. Hearing and determination

A. Key issue

Based on the attachment of a claim for partial invalidity of the local government head on the issue of the national tax refund of the nature of wage claim, where the head of the local government was subrogated to the national tax refund amount from the head of the competent tax office, whether the claimant was legitimate

(b) Relevant Acts;

(1) Framework Act on National Taxes

Article 31 (Notification of Appropriation of Refund of National Tax) Where the head of a tax office appropriates the refund of national tax (including refund on the refund of national tax included) to other national taxes, additional dues, or disposition fee for arrears pursuant to Article 51 (2) of the Act, he

Article 51 [Appropriation and Refund of National Tax Refund] (1) If a taxpayer erroneously pays or overpaid the amount of national tax, additional dues or disposition fee for arrears, or there is any amount of tax to be refunded under the tax-related Acts (where any amount of tax to be deducted from the amount of tax refundable under the tax-related Acts exists, referring to the remaining amount after deduction), the head of a tax office shall immediately determine such erroneously paid amount, excess amount or refundable amount as a refund of national tax. In such cases, a claim for refund due to erroneous

(2) The head of a tax office shall appropriate the amount determined by the national tax refund for the following national taxes, additional dues, or disposition fee for arrears, as prescribed by Presidential Decree: Provided, That the appropriation for the national taxes under subparagraphs 1 (excluding cases falling under reasons for collection prior to the due date of tax payment under Article 14 of the National Tax Collection Act) and 3 shall

1. National taxes paid by a duty payment notice;

2. National taxes, surcharges, and expenses for disposition on default (including national taxes, surcharges, and expenses for disposition on default in another tax office);

3. National taxes voluntarily paid under tax-related Acts;

(3) Where any appropriation under paragraph (2) 2 is made, the delinquent national tax, additional dues or disposition fee for arrears and the national tax refund shall be deemed to have been extinguished on an equal amount retroactively at the latest out of the statutory due date of payment of the national tax in arrears and the date of occurrence of the national

(4) Where a taxpayer is entitled to tax refund under tax-related Acts, the taxpayer may request that such tax amount be appropriated for the payment of national taxes under paragraph (2) 1 and 3. In such cases, it shall be deemed that national taxes are paid when the taxpayer requests such appropriation.

(5) Where a withholding agent has any tax refund from the amount of tax paid through withholding, he/she shall refund any remaining amount after appropriating for the amount of tax payable through withholding (a appropriation for the amount of tax withheld through withholding for other items of tax may be made only when a report on status of performance of withholding withholding under the Income Tax Act includes details of appropriation and adjustment thereof) by the withholding agent: Provided, That where the withholding agent requests immediate refund of the amount of tax refund or there is no amount of tax payable through withholding,

(6) The amount of national tax refund remaining after appropriating under paragraph (2) shall be repaid to the taxpayer within 30 days from the date of determination of the national tax refund, as prescribed by Presidential Decree.

(7) The Bank of Korea shall refund the national tax refund under paragraph (6) from among revenues under the jurisdiction of the head of a tax office as prescribed by Presidential Decree.

Where the head of a tax office appropriates or pays a national tax refund pursuant to Article 51, he/she shall add the amount calculated according to the interest rate prescribed by Presidential Decree (hereinafter referred to as "additional refund on refund of national taxes") to the national tax refund, taking into account the period from the date of calculation of the additional refund on national taxes prescribed by Presidential Decree to the date of appropriation or decision

Article 55 (Appeal) (1) Any person whose rights or interests are infringed on by an illegal or unreasonable disposition under this Act or other tax-related Acts, or by failing to receive a necessary disposition, may request the cancellation or modification of such disposition, or request a necessary disposition pursuant to this Chapter: Provided, That this shall not apply to any of the following dispositions:

1. Disposition of notification under the Procedure for the Punishment of Tax Evaders Act;

2. Disposition taken for an examination or disposition taken for an examination as prescribed by the Board of Audit and Inspection Act;

Article 45-3 (Return after Term) (1) A person who fails to file a return of tax base by the statutory due date of return may file a return of tax base after the due date of return before the head of the competent tax office determines and notifies the tax base and amount of the relevant national tax (including penalty taxes under this Act and tax-related Acts

(2) A person who files a return after the due date of tax return pursuant to paragraph (1) and has the amount of tax payable shall pay such amount.

(3) Where a return of tax base after the due date is filed pursuant to paragraph (1), the head of a competent tax office shall determine the tax base and the amount of the relevant national tax pursuant to the tax-related Acts.

(4) Necessary matters concerning matters and procedures for reporting after the due date shall be prescribed by Presidential Decree.

(2) National Tax Collection Act

Article 33 (Restriction on Attachment of Wage Claims) (1) With respect to wage, pension, wage, salary, bonus, bonus, annual allowance, retirement pension or other wage claims of similar nature, the amount equivalent to 1/2 of the total amount shall not be seized: Provided, That where the amount falls short of the amount prescribed by Presidential Decree in consideration of the minimum cost of living pursuant to the National Basic Living Security Act of standard households, or exceeds the amount prescribed by Presidential Decree in consideration of the cost of living of standard households, each amount prescribed by Presidential Decree shall not be seized.

(2) With respect to retirement allowances or other wage claims similar thereto, the amount equivalent to 1/2 of the total amount thereof shall not be subject to attachment.

(3) Income Tax Act;

Article 85 (Collection and Refund) (4) Where the amount of tax paid by interim prepayment, provisional return and payment of gain accruing from sale of land, etc., occasional assessment, and withholding exceeds the total amount of the global income determined and the total amount of retirement income determined under subparagraph 3 of Article 15, the amount of tax in excess shall be refunded or appropriated for other national taxes, additional dues, and disposition fee for arrears.

(4) Local Tax Act

Article 100 [Collection and Refund] (1) Where a resident fails to fully or partially pay the amount of individual local income tax to be paid for the relevant taxable period pursuant to Article 95, the head of the local government having jurisdiction over the place for tax payment shall collect the unpaid amount of individual local income tax in accordance with the Framework Act on Local Taxes

(2) Where the amount of tax imposed occasionally pursuant to Article 98 or specially collected pursuant to Article 103-13 exceeds the total determined amount of individual local income tax, the head of a local government having jurisdiction over the place for tax payment shall refund such amount or take measures, such as appropriation of local taxes, pursuant to

(5) The Framework Act on Local Taxes

Article 60 (Appropriation and Refund of Local Tax Refunds) (1) Where a taxpayer has overpaid or erroneously paid money collectible by a local government or he/she has an amount of refund to be refunded under the Local Tax Act (where any amount of tax to be deducted from the amount of refund under local tax-related Acts exists, referring to the remaining amount after deduction), the head of a local government shall immediately determine such overpaid or erroneously paid amount, amount of overpaid or erroneously paid, or amount of refund as a local tax refund. In such cases, a claim for refund due

(2) The head of a local government shall appropriate an amount determined as a local tax refund for the following money collectible by the local government, as prescribed by Presidential Decree: Provided, That where such amount is appropriated for local taxes under subparagraphs 1 (excluding cases falling under the grounds for collection before the payment period under the subparagraphs of Article 22 (1) of the Local Tax Collection Act) and 3, the

1. Local taxes payable by a tax payment notice;

2. Delinquent amount;

3. Local taxes to be reported and paid under this Act or local tax-related Acts;

(3) If money collectible under paragraph (2) 2 is appropriated, the delinquent amount and local tax refund shall be deemed extinguished retroactively to the same amount among the statutory deadline for payment of local taxes in arrears and the dates prescribed in the subparagraphs of Article 62 (1).

(4) Where a taxpayer is entitled to tax refund under local tax-related Acts, he/she may request that local tax be appropriated for the local tax under paragraph (2) 1 and 3. In such cases, it shall be deemed that local tax is paid when the taxpayer requests such appropriation.

(5) An amount remaining after appropriating a local tax refund pursuant to paragraph (2) shall be refunded to a taxpayer without delay from the date the local tax refund is determined.

(6) Notwithstanding paragraph (5), if the amount remaining after appropriating a local tax refund under paragraph (2) does not exceed 100,000 won, and if a refund is not made within six months from the date a decision to pay is made, it may be appropriated for local taxes under paragraph (2) 1 and 3, as prescribed by Presidential Decree. In such cases, consent under the proviso to

(6) Local Tax Collection Act

Article 42 (Restriction on Attachment of Wage Claims) (1) With respect to wage, pension, wage, salary, bonus, bonus, annual allowance, retirement pension or other wage claims of similar nature, 1/2 of the total amount shall not be seized: Provided, That where the amount falls short of the amount prescribed by Presidential Decree in consideration of the minimum cost of living of standard households under the National Basic Living Security Act, or exceeds the amount prescribed by Presidential Decree in consideration of the cost of living of standard households, the amount prescribed by Presidential Decree, respectively, shall not be seized.

(2) A half of the total amount of retirement allowances or other wage claims similar thereto shall not be subject to attachment.

Article 51 [Procedures for Attachment of Claims] (1) When the head of a local government attaches claims, he/she shall notify it to the obligor of the relevant claims (hereinafter referred to as "third obligor").

(2) Upon notification under paragraph (1), the head of a local government shall subrogate a creditor who is a delinquent taxpayer within the amount in arrears.

(3) When the head of a local government attaches claims pursuant to paragraph (1), he/she shall notify the delinquent taxpayer of such fact.

(7) Management of the National Funds

Article 47 (Calculation of Fractional Number of National Funds) (1) When there is any fraction less than ten won in the revenue or expenditure of a national fund, the fractional number shall not be calculated, and even when the total amount is less than ten won, the total amount shall not be calculated: Provided, That the same shall not apply to cases prescribed by Presidential Decree.

(2) The tax base amount of a national tax shall not be calculated, if any, by a fractional number of less than one won.

C. Facts and determination

(1) According to the withholding receipt for wage and salary income for the claimant prepared by OOO in 2016, it is confirmed that the claimant served as the OOO from January 1, 2016 to June 30, 2016, and that the OOO paid the total wage and salary income OO while the OO paid the Claimant for the above period.

(2) According to the final return on the tax base of global income tax in 2016 prepared by the claimant, the claimant was collected from the head of the OOO office on July 3, 2017 in excess of the OOO of the income tax for the year 2016 (hereinafter “OOO’s national tax refund”), excluding the end of less than ten won pursuant to Article 47(1) of the National Funds Management Act, and reported after the deadline.

(3) According to the notice of the attachment of claims by OOO on August 17, 2017, it appears that the OO seized the issue of the claimant's refund of national tax on August 17, 2017 on the ground that the claimant failed to pay two local tax OOs, such as automobile tax, etc.

(4) According to the notice of seizure of the national tax refund issued by the director of the OOO tax office on August 23, 2017, the director of the OOO tax office notified the claimant of the payment of the national tax refund at issue as the claimant's return after the global income tax return in 2016, but the OO paid the national tax refund at issue to OO upon the seizure of the national tax refund at issue.

(5) We examine the above facts and relevant laws and regulations comprehensively.

(A) Articles 51 and 52 of the Framework Act on National Taxes concerning the appropriation and refund of national tax refund and additional refund on refund of national tax are nothing more than providing the procedures for the affairs of the head of a tax office concerning the refund of national tax already finalized and the payment of additional refund on refund of national tax, but the appropriation, etc. of delinquent tax pursuant to the refund of national tax and the additional refund on refund of national tax are not an administrative disposition that has a specific and direct influence on the existence or scope of the tax payer’s right to refund, and thus cannot be deemed as a disposition subject to appeal (the same purport is the same as the Supreme Court Decision 88Nu6486 Decided June 15, 1989).

(B) The claimant asserts that the failure of the head of the OOO to pay the refund of national tax to the claimant is unlawful on the premise that the disposition is "disposition" under Article 55 (1) of the Framework Act on National Taxes;

The key issue to the claimant was that the existence and scope of the national tax refund has already been determined pursuant to Article 51(1) of the Framework Act on National Taxes; the claimant only filed a return after the deadline and does not submit an application for national tax refund regularly; the claimant's failure to receive the refund of national tax is due to the fact that OOO, the head of the local government, received the refund of national tax by subrogation of the claimant under Article 51(2) of the Local Tax Collection Act, based on the notification of the attachment of claims against OO head of the local government under Article 51(2) of the Local Tax Collection Act; and the Supreme Court also stated that "in cases where Article 51(1) of the Framework Act on National Taxes of which the existence and scope have been determined as unjust enrichment, the State has declared that the immediate return of the national tax refund without waiting for the application for refund by the taxpayer, and that the amount of erroneous payment, the existence and scope of which have already been determined, can be claimed as a civil lawsuit claiming the return of unjust enrichment (see Supreme Court Decision 2013Da212639, Aug. 27, 2015).

4. Conclusion

This case constitutes an unlawful claim as a result of a trial, and thus, is determined as per the disposition under Articles 81 and 65(1)1 of the Framework Act on National Taxes.