National High Court Decision 2004No3256 (Law No. 27, 2006)

A corporation

Revocation

Since the sales commission can be paid only upon the fulfillment of the obligation to recover the sales commission, it is reasonable to view that the supply price of the boiler product is not determined on the basis of the fact that the boiler product was shipped out of the boiler product, so the supply price of the sales commission is at the time of collection of the sales commission.

Article 13 of the Value-Added Tax Act / Tax Base / Time of Supply for Specialized Infrastructure Services

The value-added tax imposed on a claimant corporation in 2004.5.17 shall be 48,880,450 won for the first term of 1999, 118,669,260 won for the second term of 1999, 33,438,670 won for the first term of 200, 90, 223,270 won for the second term of 200, 25,090, 2671, 90 won for the second term of 201, 37,671, 90 won for 201, 202, 13,263, 370, 370 won for the second term of 202, 2589, 290, 209, 209, 209, 2930, 198, 2900 won for the second term of 209, 2009.

1. Purchase tax invoices received by the requesting corporation from the OOOO shall be deemed as legitimate tax invoices, and the amount of value-added tax shall be corrected by deducting the input tax, and the additional tax related thereto shall be excluded; and the time of supply for sales intermediary services provided to the requesting corporation shall be deemed as the date of sale recovery of boiler products, and the time of reversion of profit and loss shall be deemed as the date of sale recovery of boiler products, and the corporate tax base and tax amount for each business year shall be revised accordingly; and

2. The disposition agency shall exclude the brokerage commission and the modified portion of the component from the omitted amount of sale, in the amount of omission in sale, to correct the tax base and amount of value-added tax.

OOOOOOOOOOOOOOOOOOOOOOOOO

(O) (O)

OOOO

OOOO

OOOOO industrial cooperatives (hereinafter referred to as the "cooperative") shall consider the amount equivalent to brokerage commission related to the sale brokerage service of boiler products provided to the requesting corporation (hereinafter referred to as "intermediate brokerage commission") and the aggregate of the additional amounts resulting from the change in boiler component parts listed in the column of the sales commission payment ledger of the requesting corporation (the internal account books prepared in the Excll Program) of the boiler component column (hereinafter referred to as "change in dispute composition") as an omission in the sales of the requesting corporation:

For May 17, 2004, value-added tax was imposed on the claimant corporation 48,80,450 won for the first term in 1999, 118,669,260 won for the second term in 1999, 33,438,670 won for the second term in 200, 90, 223,270 won for the second term in 2000, 25,090, 271, 671, 90 for the second term in 2001, 37,671, 90 for the second term in 201, 13,263, 370 won for the first term in 202, 25, 789, 200 for the second term in 202, 98, 190 for the second term in 203, 209, 2098 won for the second term in 20930 for the business year.

The claimant corporation appealed against this and filed an appeal on August 12, 2004.

2. Opinion of the requesting corporation and the disposition agency;

A. The claimant corporation's assertion

(1) Time of supply for sales arrangements (sales commission)

In the case of boiler products, the product price shall be collected from consumers and remitted to the requesting corporation, but the requesting corporation pays sales commission to the business office. If the business office receives the sales commission through such transaction process and issues the tax invoice after deducting the input tax amount from the output tax amount, the requesting corporation receives the tax invoice and files the value-added tax return. Since the scope of the sales intermediary service includes the sales intermediary product price recovery, the time of supply for the sales intermediary service (sales commission) should naturally be seen as the time of recovering the sales price of boiler products from the final consumers.

(2) On omission of sale

(A) In a case where a business office and a partnership sell boiler products by providing sales intermediary and sales intermediary services, the applicant corporation pays sales commission to the partnership. The applicant corporation is an unfair disposition that did not have any grounds for taxation, in which the sales commission was paid in advance to the partnership and received tax invoices from the partnership.

(B) In the event of a change in the components of boiler products, the claimant corporation received the tax invoice on the basis of the final consumer price increased due to the changed components and the sales commission and calculated sales commission, but did not cause any omission in sales, the fact that the change in the components of boiler products was made by omitting sales is an unfair disposition without any grounds for taxation.

(b) Opinions of disposition agencies;

(1) Time of supply for sales arrangements (sales commission)

Since a tax invoice received at the time of the release of boiler products, even though it should be received at the time of the delivery of boiler products, constitutes a tax invoice different from the fact that it was received after the time of supply, the non-deduction of the input tax amount is justified.

(2) On omission of sale

(A) Between a claimant corporation, a place of business, and a partnership, recognizing each sales commission and brokerage commission as an amount of revenue, shall receive a tax invoice by transaction stage. Between a claimant corporation and a partnership, the total amount of sales commission shall be the value of supply. Between the claimant corporation and the partnership, the amount of brokerage commission shall be the value of supply, and even between the company and the partnership, the tax invoice shall be received by deducting only the brokerage commission to be paid to the partnership from the amount of sales commission, and the tax invoice shall be received by the claimant corporation. Thus,

(B) Recognizing that the increased value of supply due to the change (additional) transaction of components is the revenue amount according to the total principle, and did not comply with the separate tax invoice even though it should be received, the change in the constituent elements of the issue should be deemed to be an omission in sales.

3. Hearing and determination

(a) Points in dispute;

(1) Time of supply for sales arrangements (sales commission)

The propriety of a disposition to deduct the purchase tax amount by deeming that the sales intermediary service (sales commission) of boiler products supplied by the business office was received after the time of supply for the said boiler products is supplied.

(2) On omission of sale

(A) The propriety of the disposition imposing tax on the commission of dispute mediation by omitting sales

(B) The propriety of the disposition imposing tax by deeming the change of the issue structure as omitting sales

(b) Related statutes;

No. 1. Relevant Acts and subordinate statutes

Article 13 of the Value-Added Tax Act

(1) The tax base of value-added taxes on the supply of goods or services shall be the aggregate of values falling under each of the following subparagraphs (hereinafter referred to as "value-added taxes"): Provided, That value

1. Where payments are given in money, the payments;

Article 9 of the Value-Added Tax Act

(1) The time of supply for goods shall be the time provided for in the following subparagraphs:

1. When the goods are delivered, in case where the moving of goods is required;

2. When the goods are made available, in case where the moving of goods is not required; and

3. When the supply of goods is decided, in case where the provisions of subparagraphs 1 and 2 are not applicable.

(2) The time of supply for services shall be the time when services are supplied or goods, facilities or rights are used.

Article 22 of the Enforcement Decree of the Value-Added Tax Act

The time of supply for services under Article 9 (2) of the Act shall be as follows: Provided, That if the time of supply for services supplied before closure of business arrives after such cessation of business, the time of supply for such services shall be deemed the

1. In the case of ordinary supply, when the offer of the service is completed;

2. Where services are supplied on the basis of an interim payment, a long-term installment or on other terms, or services which cannot be continuously supplied on the basis of a unit of supply, when each part of the price is ordered to be received;

3. Where the provision of services is completed and the value of supply is determined, in case where the provisions of subparagraphs 1 and 2 are not applicable.

Dispute (2) Relevant Acts and subordinate statutes

Article 1 of the Value-Added Tax Act

(1) Value-added taxes shall be imposed on the following transactions:

1. Supply of goods or services; and

Article 21 of the Value-Added Tax Act

(1) The head of a regional tax office, the commissioner of a regional tax office or the Commissioner of the National Tax Service shall correct the tax base and amount of value-added tax paid or refunded for the taxable period,

1. Where the final tax return is not filed;

2. Where there are any mistakes or omissions in details of the final tax return;

C. Facts and determination

For disputes (1)

(1) As a result of an investigation with respect to the claimant corporation, the agency shall regard the time of supply for the key service provided by its place of business as the date of shipment of boiler products, and the tax invoice on the issue of Table 1, which is received by the claimant corporation in relation to the sales commission paid at its place of business, shall be deemed the fact of receipt after the time of supply for the key service provided by its place of business, and shall not deduct the relevant input tax amount. The fact that the time of supply for the key service is deemed the date of delivery of boiler products and the fact of this case

Table 1. Statement of purchase tax invoices received by the requesting corporation

(O) (O)

(2) The claimant corporation presented a sales agency contract by asserting that the sales agency contract was unfair, claiming that the sales price for the place of business is determined in consideration of the sales performance of the previous year and that the sales price for the place of business is determined by the claim corporation, and that if the sales contract for the sales of the product between the final consumer and the claim corporation is arranged, the difference between the sales price for the final consumer and the sales price for the place of business is paid as sales commission.

(3) Of the major contents of the sales agency contract entered into between the requesting corporation and the business office, Article 8 states that "the amount of sales proceeds from the actual consumers shall be entirely responsible for the business office and the business office shall be liable to pay if it is impossible to collect the proceeds due to the reasons such as the actual consumer's bankruptcy and default." Article 9 states that "the calculation of sales commission shall be limited to the amount of sales commission paid by issuing a tax invoice from the first day of each month to the balance by the last day of the following month, and the payment shall be the 10th day of the following month," and the requesting corporation appears to have received the issue tax invoice issued by the business office after calculating sales commission if the sales agency contract completely collects the sales proceeds from the final consumers and deposits to the requesting corporation

(4) On the other hand, the agency responsible for the settlement of sales commission agreement at the time of shipping the boiler product. Thus, the key issue invoice is that the input tax amount should be deducted because the supply time of the boiler product falls under a tax invoice different from the fact that the service was received after the time of supply, and the time of the supply of the boiler product should be changed considering the time of the supply of the boiler product as the date of the delivery of the boiler product. However, considering the characteristics of the product, if the boiler product is installed at the place designated by the final consumer after the delivery and is operated normally through the trial run, the agency shall pay the price to the final consumer for the product at the place of business and receive the tax invoice for the issue of the sales commission issued by the applicant at the place of business after the settlement of the sales commission agreement at the place of business. In this case, the agency is obliged to collect the sales commission for the boiler product under the agreement of the sales agency agreement, and the sales commission can be paid only when the boiler product was delivered.

If it is true, it seems reasonable to see that the time of supply for the key vessel services is not the time of delivery of boiler products, but the time of collection of sales proceeds of boiler products.

Therefore, it is judged that the disposition authority, considering the fact that the tax invoice was received after the time of supply for the service, did not deduct the input tax amount, and that the time of supply for the service at issue is deemed the date of delivery for the boiler product, and the disposition to change the time of ownership for profit and loss was erroneous. Therefore, it is reasonable to adjust the time of supply for the service at issue by deeming the time of supply for the service at issue as the due date of sale for the boiler product.

For disputes (2)

(1) The disposition agency is confirmed by the hearing data, such as a correction resolution, that this case was imposed by deeming the amount of the dispute mediation commission and the change in the structure of the issues in the table 2 as an omission in sales (the corporate tax due to the omission in sales shall not be corrected).

Details of the change in the composition of boiler products, conciliation fees and boiler products.

(O) (O)

(2) We examine the issues of the disposition by omitting the sales commission.

(A) The disposition agency's payment of the sales commission to the association which deducts the sales commission from the sales commission to the sales commission, and the payment of the remainder to the remaining sales office is contrary to the principle of total value, and thus, the disposition agency's imposition of this case is indicated in the investigation receipt.

(B) In accordance with the terms and conditions of the “sales agency contract” with the applicant corporation, the association calculates sales commission and brokerage commission in accordance with the terms and conditions of the “Rules on Provisional Payments, Investments, Expenses, etc.” and receives a tax invoice issued by the business office and the partnership respectively. Therefore, the applicant corporation’s disposition that imposed the amount of brokerage commission paid to the association on the ground that there is no possibility of omission of sales, is unreasonable.

(C) In the case of sales commission, as seen in the key issue (1), the applicant corporation determines the sales price for the place of business in consideration of the sales performance of the previous year of the sales agency contract, and if the place of business is arranged for a transaction with the final consumer and the applicant corporation for the sales of products, the difference between the sales price and the sales price for the final consumer and the sales price for the place of business shall be paid as sales commission. In the case of brokerage commission, Article 13 (1) of the Regulations on Provisional Payments, Investments, Expenses, etc., provides that "this association shall collect the commission and the user fee under Article 15 of the Articles of Incorporation," and Article 13 (2) provides that "the person subject to the collection of the commission and the user fee and the rate thereof shall be as follows," and subparagraph 2 provides that "within 2% of the sales commission for products shall be paid to the association equivalent to 2% of the final consumer price in accordance with the contents of the agreement."

(D) On the other hand, the Claimant's position that the Claimant's office should calculate the sales commission in accordance with the agreement between the Claimant's office and the Claimant's office and calculate the sales commission in accordance with the agreement between the Claimant's office and the Claimant's office, and the Claimant's office separately calculates the sales commission in accordance with the agreement between the Claimant's office and the Claimant's office and the Claimant's office, and if the Claimant's office provides the sales brokerage service, it is difficult to see that the Claimant's office and the Claimant's office are divided into the sales commission and the Claimant's office and the Claimant's association, and it is also hard to see that the Claimant's office and the Claimant's office violate the total amount of sales commission and the Claimant's sales commission, and it is not clear in the grounds of taxation that can see the Claimant's sales omission.

Therefore, it is judged that the disposition of the disposition is against the principle of taxation on the ground that the disposition of the disposition is an omission in the sales of the requesting corporation without clearly disclosing the basis of taxation.

(3) We examine the change in the main structure of the claimant corporation's sales omission.

(A) The disposition agency is indicated in the review data, such as a correction resolution, by deeming that the change in the composition of the issues recorded in the column for additional deduction in the sales commission ledger of the applicant corporation was an omission in the sales of the applicant corporation.

(B) The claimant corporation asserts that, where the basic components of the original contract are modified and supplied, the sales tax invoice is issued based on the sales price of the boiler products finally determined by reflecting the sales price of the modified components and that, even if the sales commission was settled on the basis of that amount, this disposition is an unfair disposition that does not have any grounds for taxation.

(C) In the sales commission payment ledger kept by the applicant corporation, the date of payment, name of the business office, name of the trader, total contract amount, facility cost, other construction cost, sales commission, additional payment, additional payment, distinction (whether to add options, distinction between construction commission and brokerage commission), commission deduction amount, actual commission payment, etc. In light of the process of calculating the sales commission of the applicant corporation, it is confirmed that the applicant corporation entered the total contract amount into the calculation of the sales commission amount, including the additional payment due to the changes in the composition of the original contract, the additional payment due to the changes in the composition of the contract, and the additional amount if any, the total contract amount is calculated and the sales commission is calculated based on the calculation of the total contract amount. The applicant corporation

(D) Meanwhile, the person in charge of the investigation of the disposition agency was present at the inquiry division of Korea during this case and stated that the total amount of the change in components appearing in the column of the additional premium amount among the items in the above sales commission payment ledger was taxed by viewing the total amount of the change in components as an omission in sales.

(E) On the other hand, as seen above, the change in the composition of the issue indicated in the column of the additional amount in the sales commission payment ledger is merely an interim stage to calculate the final sales commission, and the amount was already reflected in the calculation of the final sales commission, and even if it is confirmed that the amount was already included in the issue amount of the tax invoice, the disposition agency deemed it an omission in sales and imposed the change in the structure of the issue as an omission in sales by the applicant corporation. Thus, it is not clear that the tax basis can be deemed as an omission in sales by the applicant corporation.

Therefore, the disposition that the disposition agency imposed on the change of the composition of the issue by deeming the change of the composition of the issue as the omission of the sales of the requesting corporation without clearly stating the grounds for taxation is judged to be unfair

4. Conclusion

This case shall be decided as ordered in accordance with the provisions of Article 81 and Article 65 (1) 3 of the Framework Act on National Taxes, because the petition for appeal is well-grounded as a result of the review.