propriety of any disposition imposing value-added tax on an officetel using it for residential purposes

If an officetel is actually used for residential purposes without any residential facilities, and the lessee’s location of the officetel has no business registration, etc., the disposition imposing value-added tax is legitimate on the ground that it cannot be deemed that it was used for business purposes.

Article 12 (Exemption of the former Value-Added Tax Act)

Article 34 (Scope of Leasing Housing and Land Appurtenant thereto)

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 value-added tax amounting to KRW 20,557,050 for the second period of 2006 against the Plaintiff on May 1, 2007 is revoked.

1. Details of the disposition;

The following facts shall not be disputed between the parties, or may be admitted by entry in Gap's 1, 2, 6, and Eul's 1 through 3:

A. On March 30, 2006, the Plaintiff purchased ○○○○○○○-1 ○○○○○○○○○-1 1504 (hereinafter “the instant officetel”) from Anyang-si Co., Ltd., and at the time of reporting the first quarter value-added tax in 2006, the Plaintiff reported KRW 19,480,000 equivalent to 10% of the sales price of the building as the input tax amount, and received refund of KRW 19,480,000 on June 9, 2006.

B. On May 1, 2007, the Defendant denied the Plaintiff’s input tax deduction for the instant officetel on the grounds that the Plaintiff leased the instant officetel for residential purpose, and imposed and notified the Plaintiff of KRW 20,557,050 for the first quarter of 2006 (hereinafter “instant disposition”).

C. On August 27, 2007, the Plaintiff appealed against the instant disposition, and filed an appeal with the National Tax Tribunal, but was dismissed on January 25, 2008.

2. Determination of legality of disposition

A. The plaintiff's assertion

The Plaintiff leased the instant officetel for business purposes, and reported and paid the value-added tax thereon. Therefore, it is legitimate to obtain input tax deduction. Therefore, the instant disposition made on a different premise is unlawful.

(b) Related statutes;

Article 12 (Exemption of the former Value-Added Tax Act)

Article 34 (Scope of Leasing Housing and Land Appurtenant thereto)

(c) Fact of recognition;

The following facts are not disputed between the parties, or may be acknowledged by the statements or images of Gap evidence 8, Eul evidence 4 and 7, Eul evidence 6-1 through 7, Eul evidence 8-1 and Eul evidence 8-2:

(1) On September 7, 2006, the Plaintiff leased the instant officetel with the term of 140,000,000, and the term of 30 September 30, 2006 from September 30, 2006 to September 30, 2008.

(2) On November 5, 2007, 2007, ○○○○○○○○○○○ apartment, 102 Dong 1303, and 1303, new scrap metal, together with her wife and 2 children, completed the move-in report for resident registration. The above apartment, five family members of Kim○-si resided from August 23, 2006 to August 9, 2008.

(3) As of February 2, 2007, the instant officetel was actually used for residential purposes after being equipped with residential facilities, and there was no fact that the instant officetel was registered as the location of the instant officetel.

D. Determination

(1) On the other hand, in a lawsuit seeking revocation of the disposition imposing tax, the burden of proving the facts of taxation requirements should be borne by the imposing authority. However, if it is revealed that the facts of taxation requirements are presumed in light of the empirical rule in the course of a specific lawsuit, it cannot be readily concluded that the other party is an illegal disposition that fails to meet the taxation requirements with the pertinent taxation disposition unless it proves that the facts in question are not eligible for the application of the empirical rule (see, e.g., Supreme Court Decision 2002Du6392, Nov. 13, 2002).

(2) Therefore, as to whether the Plaintiff leased the instant officetel for business purposes, the Plaintiff’s assertion is without merit, and there is no other evidence to acknowledge the Plaintiff’s assertion on the following grounds: (a) the Plaintiff’s statement on the instant officetel No. 4 and No. 5, which corresponds thereto, is insufficient to believe that it was not in good faith in light of the above fact of recognition; and (b) there is no other evidence to acknowledge it (i.e., the fact that the instant officetel used the instant officetel for residential purposes).

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.