Whether Kwikset service charges can be seen as Plaintiff’s sales

Cash delivery fees received by a door-to-door engineer omitted by the Plaintiff shall not be excluded from the portion received by a door-to-door engineer, and the entire cash delivery fees shall be regarded as the Plaintiff’s sales.

Article 4 [Taxable Object] of the Value-Added Tax Act

2017Guhap69618 Disposition to revoke the imposition of value-added tax

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00. Head of tax office

oly 2018 09.06

October 25, 2018

1. The plaintiff's claim is dismissed.

2. Litigation costs shall be borne by the Plaintiff

Cheong-gu Office

(1) Each disposition taken by the Defendant on July 20, 201 against the Plaintiff (including additional tax), KRW 000 (including additional tax), KRW 000 (2) on October 25, 2016, KRW 000 of the value-added tax for the second period of 2011 on October 25, 2016, KRW 000 of the value-added tax for the first period of 2012, KRW 000 of the value-added tax for the second period of 2012, KRW 1 value-added tax for the year 2013, and KRW 000 of the value-added tax for the second period of 2013 (including additional tax) shall be revoked.

1. Details of the disposition;

A. The Plaintiff is a personal entrepreneur who operates '00 Kwikset Service' from 00, 80, 129, 901 (Yecheon-dong, Maak-si, Maakkset apartment) to operate a business category from March 2006 to 100 Kwikset Service (hereinafter “instant business place”). The Plaintiff is running Kwikset Service, which allows Kwikset service engineers to deliver the goods to the Plaintiff to the customer’s desired place.

B. After conducting a tax investigation with respect to the Plaintiff, the Defendant deemed that the Plaintiff omitted the report on cash delivery charges received by Kwikset Service Articles directly from their customers from 2011 to 2013, and subsequently corrected and notified the Plaintiff each of the following dispositions (hereinafter referred to as “each of the instant dispositions”). (1) on July 20, 201, value-added tax for the first period of July 20, 201 (including additional taxes), (2) on October 25, 2016, value-added tax for the second period of October 201, 201, value-added tax for the first year of 200, value-added tax for the second year of 200, value-added tax for the second year of 2012, value-added tax for the first year of 200, and value-added tax for the second year of 2013 (including additional taxes) for the second year of 2013 (hereinafter referred to as “each of the instant dispositions”).

C. The Plaintiff is dissatisfied with each of the dispositions in this case, and filed an objection against the correction and notification of value-added tax for the first period of 201, and filed an appeal with the Tax Tribunal on December 16, 2016 on the remainder of the disposition, but was dismissed on April 7, 2017.

[Ground of Recognition] Unsatisfy, Gap evidence 1, Eul evidence 1 to 3 (including each number)

Statement, the purport of the whole pleading

2. Whether the disposition is lawful;

A. The plaintiff's assertion

Although the Defendant: (a) considered the entire delivery fee received from the customer as the Plaintiff’s sales; (b) considered the Plaintiff’s sales and rendered each of the instant dispositions; (c) the type of Kwikset service business operated by the Plaintiff as the type of Kwikset service business is a door-to-door brokerage and brokerage business that connects an unspecified customer to Kwikset service article located in the place where the delivery order enters the instant workplace, such as acting as a substitute driving service provider; and (d) only

The plaintiff is deemed to have supplied the whole of cash delivery fees as a door-to-door dispatch service provider.

In addition to fees actually received, the Plaintiff’s taxable objects up to delivery fees received by Kwikset Service Articles

Each disposition of this case, which calculated value-added tax by including it, shall be revoked because it violates the substance over form principle under Article 14(2) of the Framework Act on National Taxes, which provides that "the provisions on tax base shall be applied according to substance regardless of the name or form of income, profit, property, act or transaction."

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

In light of the following facts and circumstances revealed by adding the aforementioned evidence, Gap evidence Nos. 3, 4, Eul evidence Nos. 5 and 6, witness Kim Yong-sik's testimony and the whole purport of the arguments, the plaintiff is not merely an intermediary of delivery order customer and Kwikset service engineer, as alleged by the plaintiff,

It can be recognized that the freight rate was determined under the independent calculation and responsibility and carried out the door-to-door sales business that delivers the freight of the customer to the designated place, and the entries in Gap evidence 2 and 5 (including each number) are insufficient to reverse the above recognition, and there is no counter-proof otherwise.

Therefore, each of the dispositions of this case, which took place by deeming the whole cash delivery fee, omitted by the Plaintiff as the Plaintiff’s sale, is legitimate, and the Plaintiff’s assertion on a different premise is without merit.

1) The Plaintiff’s Kwikset service business is conducted in the following manner. In other words, upon receipt of an order from an unspecified number of customers, the Plaintiff registered the Internet-based Kwikset Service Sharing Program (the Plaintiff entered into a contract for use with 00 Kwikset Service Co., Ltd. (hereinafter “00 Kwikset Service”) and used the “personal program” produced and supplied by 00 Kwikset Service Co., Ltd.). An article of Kwikset Service belongs to a specific Kwikset Service Company like the Plaintiff, and is entitled to use the shared program joined by the relevant company. The article of Kwikset Service and other Kwikset Service Companies, who belong to other Kwikset Service Companies that use personal program, will receive delivery orders (PDA) shared by the Plaintiff or other Kwikset Service Companies that use the personal program through a mobile information terminal (PDA) where a personal program is installed, and will be easy to confirm delivery orders (delivery charges, arrival point, contact points) and delivery of cargo among nearby cargo.

The Plaintiff, Kwikset service companies and Kwikset service engineers, such as the Plaintiff, set aside their respective reserves in the above sharing program, and credit card sales from Kwikset service companies received delivery orders, accumulated in the above sharing program, and the amount equivalent to 77% of the credit card sales from the reserve funds accumulated in the above sharing program. Kwikset service companies automatically withdrawn from Kwikset service providers, and the cash sales directly received from Kwikset service engineers in the field of the program were made in the way that the amount equivalent to 23% of the cash sales was automatically withdrawn from the reserve funds accumulated in the program of this case by Kwikset service companies.

2) As can be seen, the customer merely ordered the Plaintiff to deliver the delivery under the overall terms and conditions of delivery, including the type of the delivery, destination and place of departure, transportation charges, and payment method, and did not determine transportation charges, etc. separately from the Kwikset service article. According to the witness KimO’s testimony, which is the Kwikset service article belonging to the Plaintiff, Kwikset service article would issue to the Plaintiff public receipts that are not separately stated by the supplier, rather than issuing the receipt under the name of the provider. If Kwikset service article entered his phone number, etc., the customer would be subject to sanctions by deeming that it was personal promotion if the Kwikset service article entered his/her phone number, etc.

In full view of the above circumstances, the cargo delivery contract is concluded between the plaintiff and the customer, and Kwikset service article is considered to be in the position of the outsourcing service provider entrusted by the plaintiff.

3) The Plaintiff reported to an unspecified number of unspecified customers the total amount of delivery fees for the portion of credit card sales excluding cash sales, and paid value-added tax on the total amount of delivery fees agreed regardless of credit card or cash transactions with respect to the above type of service provided to a fixed trading agency. It is reasonable to view that the method of payment of delivery fees for Kwikset service articles that vary depending on credit card sales and cash sales does not result in a difference in the method of receiving the payment for the same type of service in cash received by an unspecified number of customers and does not change the form of business. In other words, it is reasonable to deem that the method of payment of delivery fees for Kwikset service articles that vary from credit card sales and cash sales does not result in a difference in the content and nature of each individual’s business, and the method of receiving the Plaintiff’s commission is merely a means of adoption to easily settle the payment

4) With respect to the use of a tax invoice among the personal programs, the 00 Liberist instructs that when a tax invoice is issued between the Plaintiff and the same member company and the customer, the basic fee shall be the amount to be received from the customer, and the amount of article shall be the amount to be paid to the article less the fee.

According to this, Kwikset service article using a personal program is not a contracting entity of the delivery order, but is a member of the above sharing program and the Plaintiff engaging in Kwikset service business.

Delivery services are provided under an agreement with the same company and are in the position of receiving the payment for such services.

There seems to be a seal.

5) Even if there is no evidence to acknowledge that Kwikset service engineers registered with the Plaintiff are operating their business as a separate independent business operator and running their delivery business, and even if Kwikset service engineers were to deduct KRW 800 from the reserve accumulated in the joint program each day from the amount of insurance premium, such fact alone may be deemed to have decided that the Plaintiff and Kwikset service engineers would belong to the final burden of insurance premium among the Plaintiff and the Kwikset service engineers, and it cannot be deemed that Kwikset service engineers become the subject of the responsibility for follow-up compensation, etc. related to the cargo delivery service.

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit. It is so decided as per Disposition.