early 208 Heavy2457 ( November 20, 2008)

Appropriateness of the assertion that foreign personnel expenses have been paid

Although the withdrawal of cash in a deposit account in the name of the employee is recognized, it is difficult to believe that the employee was actually paid personnel expenses only on the evidence submitted.

The contents of the decision shall be the same as attached.

1. The plaintiff's claim is dismissed.

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

The Defendant’s disposition of imposition of global income tax of KRW 38,173,270 for the Plaintiff on February 1, 2008, global income tax of KRW 21,029,880 for the year 2003, and global income tax of KRW 45,471,420 for the year 204 is revoked.

1. Circumstances of the disposition;

A. The Plaintiff, while operating Gyeongdo-si 183-18 (hereinafter referred to as the “instant tax invoice”), filed a comprehensive income tax return from 2002 to 2004 on the total income tax for the pertinent taxable year after receiving the false purchase tax invoice equivalent to KRW 216,353,00 in total amount of KRW 79,80,000, KRW 47,767,000 in 203, and KRW 2000 in total of KRW 88,786,00 in 204 (hereinafter referred to as the “instant tax invoice”).

B. On February 1, 2008, the Defendant issued a revised and notified each of the total income tax of KRW 38,273,270, 2002, KRW 21,029,880, and KRW 45,471,420 for each of the pertinent year to which the value of supply was attributed, on the ground that the instant tax invoice is a tax invoice for processing without real transaction (hereinafter “instant tax assessment disposition”).

C. On June 24, 2008, the Plaintiff filed an objection against the instant disposition with the Tax Tribunal on June 24, 2008, but was dismissed on November 20, 2008.

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

2. Whether the dispositions of the instant case are legal.

(a)the master of the plaintiff;

In order to prevent the return income rate from falling rapidly compared to the immediately preceding year as a result of appropriating the supply value according to the purchase account statement of this case as necessary expenses, the Plaintiff did not include the total of KRW 237,451,318 (hereinafter “the instant personnel expenses”) out of the cash payment paid to employees during the pertinent taxable period, as necessary expenses, in order to prevent the Plaintiff from falling short of the reported income rate from falling rapidly compared to the immediately preceding year. The instant disposition that did not recognize the said amount as necessary expenses is unlawful, even though the instant personnel expenses were actually paid by the Plaintiff to operate the business, which is not recognized as necessary expenses.

B. Determination

Inasmuch as the tax authority bears the burden of proving the legality of a taxation disposition, the tax authority bears the burden of proof as a matter of principle, but the tax authority bears the burden of proof as necessary expenses, since the deduction of necessary expenses is not only favorable to the taxpayer, but most of the facts constituting the basis of necessary expenses are located in the controlled area of the taxpayer, and thus the tax authority has difficulty in proving it, so it is reasonable to have the taxpayer prove it, taking into account the difficulty in proving it or equity between the parties (see Supreme Court Decision 91Nu10909, Jul. 28, 1992). It is clear that the tax invoice of this case concerning the value of supply originally appropriated as necessary expenses as in this case was issued without real transaction, and the Plaintiff asserts that there was a fact of expenditure of other authorization equivalent to the value of supply under the tax invoice of this case, so it is easy for the Plaintiff to present specific data, such as account books and documentary evidence, etc.

According to each of the above statements, Gap evidence Nos. 5-1 through 48, the plaintiff was found to have withdrawn KRW 50,000 from his deposit account in the name of the plaintiff from January 2002 to December 2004. However, as shown in the plaintiff's argument, Gap evidence Nos. 2, 3-1 through 13, 4-1 through 36, 6-1 through 10, and 7-1 through 12 are difficult to believe that the above facts were insufficient to view that the plaintiff actually paid the labor cost of this case to its employees, or that it was difficult to view that it was not included in the necessary expenses at the initial global income tax return return even if it was paid, it was difficult to find that the plaintiff did not easily accept the plaintiff's assertion that the plaintiff did not have any more than the necessary expenses in order to conceal the amount calculated as necessary expenses through the tax invoice of this case.

3. Conclusion

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