Taxation of corporate tax and bonus disposition after converting the omitted amount of purchase into sales

Since it is recognized that the original disposition is not properly reported in light of the circumstances such as the transaction partner's confirmation and the account for payment of goods, etc., the original disposition is legitimate.

§ 116. Receipt and safekeeping of documentary evidence of expenditure of the Corporate Tax Act

Article 76 of the Corporate Tax Act

1. The plaintiff's claim is dismissed.

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

1. Details of the disposition;

The following facts are acknowledged as a whole in each entry of Gap evidence 1-1-2, Eul evidence 1-3, Eul evidence 4-1-2, and the whole purport of the pleading.

A. On February 10, 1999, the Plaintiff engaged in the wholesale business of livestock products by opening a business on February 10, 199, and closed down business on December 31, 200.

B. The defendant, from the director of ○○ Regional Tax Office and the director of ○○ Tax Office, failed to report the amount of KRW 572,249,919, which the plaintiff purchased from ○○○○○○○○○○○○○○ (hereinafter referred to as “non-party company”) during the business year 2000, and notified the tax data that he received an invoice amounting to KRW 13,057,410, without real transaction from ○○○○○○○ distribution, and added the amount of the purchase omitted to KRW 61,182,226, which was converted to the gross profit rate of the purchase omitted amount to KRW 61,182,226, and added the additional tax to KRW 50 (hereinafter referred to as “the additional tax of KRW 50,581, Dec. 31, 199; hereinafter referred to as “the additional tax of KRW 505,70,00).

3) In the confirmation document prepared at the time of the tax investigation, the representative director of the non-party company supplied the plaintiff with the livestock products of KRW 780,276,220, but the invoice was issued only KRW 208,026,301, and the invoice was not issued with respect to the omission of purchase of this case, which is equivalent to the difference between the non-party company and the plaintiff. The transaction portion up to February 16, 2000 between the non-party company and the plaintiff was arranged as the non-party ○○, and then as the ○○○.

4) From the Plaintiff’s deposit account to ○○○○’s account, all of KRW 2.5 billion was transferred over 1.30 times in 200, and KRW 4.3 million was withdrawn and paid to the Nonparty Company. The Plaintiff’s account book did not indicate that the Plaintiff received the provisional payment from ○○○○○.

3. Hearing and determination

(a) Related statutes;

former Corporate Tax Act (amended by Act No. 5581 of Dec. 28, 1998 and amended by Act No. 6558 of Dec. 31, 2001)

Article 76 (Additional Tax)

(5) In case where a corporation (excluding such corporation as prescribed by the Presidential Decree) is supplied goods or services with an entrepreneur as prescribed by the Presidential Decree in connection with its business and fails to receive the evidential documents as prescribed in Article 116 (2) 1-1 (a), the chief of the district tax office having jurisdiction over the place of tax payment shall make a request for the case subject to the proviso of the same paragraph, and collect as corporate tax the amount calculated by adding an amount equivalent to 10/100

Article 116 (Receipt and Safekeeping of Documentary Evidence of Expenditures)

(1) A corporation shall prepare or receive documentary evidence for all transactions related to its business for each business year, and keep them for 5 years from the date on which the time limit for loss under the provisions of Article 60 expires.

(2) In cases of paragraph (1), where any corporation receives goods or services from a business operator prescribed by the Presidential Decree and pays the price therefor, it shall receive and keep the evidential documents falling under any of the following subparagraphs: Provided, That the same shall not apply to cases prescribed by

1. Credit card sales slip under the Specialized Credit Financial Business Act (in case of transactions conducted using things similar to a credit card as prescribed by the Presidential Decree, including the documentary evidence);

2. Tax invoice under Article 16 of the Value-Added Tax Act;

3. Invoice under Article 121 of this Act and Article 163 of the Income Tax Act.

(3) Matters necessary for the receipt, keeping, etc. of documentary evidence in keeping the records under paragraphs (1) and (2) shall be prescribed by Presidential Decree.

Added (No. 5581, Dec. 28, 1998)

Article 1 (Effective Date) This Act shall enter into force on January 1, 199: Provided, That the amended provisions of Articles 8, 16, 17, 33, 34, 36, 46 through 49, 59, 63, 79, 81, 84, 86, and 99 (11) (limited to the part related to division) and the amended provisions of Article 29 (1) shall enter into force on the date of its promulgation, the amended provisions of Articles 28 (2) through (4), and 76 (5) shall enter into force on the date of its promulgation, and the amended provisions of Articles 76 (9) 1 and 121 (2) shall enter into force on the date of January 1, 200, and from July 1, 199.

Article 2 (General Application) This Act shall apply from the first beginning of the business year after this Act enters into force: Provided, That the amended provisions concerning corporate tax on liquidation income shall apply from the first dissolution or merger after this Act enters into force or from the division in the business year to which the enforcement date of this Act belongs, and the amended provisions concerning special surtax shall apply from the first transfer after this Act enters into force.

Article 7 (Application of Additional Taxes, etc.)

(3) The amended provisions of Article 76 (5) shall apply from the portion of the first supply of goods or services after January 1, 2000, and the amended provisions of Article 116 shall apply from the portion of the first supply of goods or services after this Act enters into force.

Corporate Tax Act (Amended by Act No. 6558, Dec. 31, 2001)

Article 76 (Additional Tax)

(5) In case where a corporation (excluding such corporation as prescribed by the Presidential Decree) is supplied goods or services with an entrepreneur as prescribed by the Presidential Decree in connection with its business and fails to receive the evidential documents as prescribed in any of subparagraphs of Article 116 (2) (n) through (e), the chief of the district tax office having jurisdiction over the place of tax payment shall collect the amount calculated by adding an amount equivalent to 2/100 of the unpaid amount to the corporate tax, except

Addenda No. 6558, Dec. 31, 2001

This Act shall enter into force on January 1, 2002: Provided, That the amended provisions of Articles 45 (1), 61 (1), 76 (3) and (5), and 114 shall enter into force on the date of its promulgation, and the amended provisions of Articles 98-4 and 120-2 (1) shall enter into force on July 1, 2002, respectively.

Article 12 (Application Cases of Additional Tax)

(2) The amended provisions of Article 76 (5) shall apply to the portion of goods or services supplied in the business year in which the date of promulgation of this Act falls.

B. Determination

1) Comprehensively taking account of these facts, it is difficult to conclude that the representative director of the non-party company was a party to the non-party company's transaction with the plaintiff and did not prepare an invoice for the omission of the purchase of this case. ○○○○○○○ Agency separately from the plaintiff. The non-party company operated the non-party company's "○○○○○ Agency" separately from the plaintiff. There is no evidence to deem that the non-party company's "○○○○ Agency" recorded in the account book with the plaintiff "○○○○ Agency" was "○○○" operated by the non-party company. It is reasonable to see that the non-party company's purchase of the non-party company and the non-party company's product price was paid through the non-party company's deposit account. Even if the price of the non-party company was paid through the non-party company's deposit account, it is merely a party to the non-party company's transaction with the non-party company's non-party company's non-party company's non-party company's account.

2) Therefore, the above argument is without merit.

(2) Determination as to the assertion of the above A. (2)

(A) Considering the following circumstances: (a) the instant additional tax provision was prepared to enhance transparency in the expenditure content of a corporation and induce the other party to the transaction to cultivate tax base; (b) imposing only the obligation to bona fide return on the transaction party is difficult to achieve its legislative purpose; (c) imposing additional tax is appropriate and consistent with the public interest; and (d) how to determine the additional tax rate belongs to legislative discretion; and (e) it is difficult to deem that imposing 10% additional tax on the person who fails to perform the obligation is merely a matter of course in light of the three-dimensional circumstances, it cannot be deemed that the instant additional tax provision goes against the principle of excessive prohibition under the Constitution or is unconstitutional by infringing on an individual’s property right (see Constitutional Court Order 2004HunGa7, Nov. 24, 2005).

(B) Therefore, the above assertion is without merit.

4. Conclusion

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