Suwon District Court 2010Guhap9069 ( October 20, 2011)

National Tax Service Review Income 2009-0028 (203.30)

The initial date of exclusion from the imposition of global income tax due to the disposal of the income shall be 6.1 day following the deadline for reporting the business year to which the income belongs.

The liability to pay global income tax on the disposal is established at the end of the relevant taxable period, and the initial date of the exclusion period shall be June 1 following the due date of the return of the year to which the global income tax belongs under the Income Tax Act.

2011Nu17808 Gross income and revocation of disposition

XX

Head of Ansan Tax Office

Suwon District Court Decision 2010Guhap9069 Decided April 20, 2011

March 28, 2012

May 2, 2012

1. Of the judgment of the first instance court, the part against the plaintiff falling under the order to revoke below shall be revoked.

The imposition of global income tax of 000 won for the year 2001 and global income tax of 000 won for the year 2002 against the Plaintiff on December 1, 2008 shall be revoked.

2. The remaining appeal filed by the Plaintiff shall be dismissed.

3. Of the total litigation costs, 30% is borne by the Plaintiff, and 70% is borne by the Defendant.

The judgment of the first instance shall be revoked. The disposition of imposition of global income tax of 000 won for the Plaintiff on December 1, 2008, global income tax of 2001, global income tax of 000 won for the year 2002, and global income tax of 000 won for the year 2003 shall be revoked.

1. Details of disposition;

A. The Plaintiff was in office as a representative director on September 26, 2000 from XX Co., Ltd. (hereinafter referred to as “ XX”) until April 17, 2005.

B. XX submitted a purchase tax invoice amounting to the amount of 000 won on the purchase of goods from OOcare LLC Co., Ltd. (hereinafter referred to as 'Ocare blade') from the year of 2001 to the business year of 2003, and included the purchase amount in the calculation of losses.

C. From July 20, 2004 to October 15, 2004, the Defendant conducted a tax investigation with regard to XX, and determined that the above purchase tax invoice was a processed tax invoice issued without real transaction. On January 3, 2005, the Defendant imposed value-added tax KRW 000 and corporate tax KRW 000 and the processed purchase part as the representative director, and reverted to the Plaintiff, which is the Plaintiff, as the representative director, in the inclusion of the processed purchase part into the gross income. The Plaintiff’s business year income was KRW 00,000 and the business year income of 2003 was the total of KRW 00 and KRW 000,000 (hereinafter “instant notice of change of income amount”). The instant notice of change of income amount reached XX on January 5, 2005, but did not pay the amount of withholding tax returned on February 10, 2005.

D. The Defendant, on April 8, 2005, did not perform the obligation to withhold income tax pursuant to the notice of change in the income amount of this case, subject to the collection of withholding income tax 000 won in XX.

E. The Defendant, upon receiving a report on discontinuance of business on September 28, 2005, issued a disposition of non-property loss with respect to the income tax that was disposed of in XX on September 30, 2005, on the grounds of which the Defendant imposed a disposition of non-property loss, etc. according to the audit of the Jungbu regional tax office, and revoked the disposition of collection of income tax of 000 won on December 1, 2008, and imposed a disposition of imposition of 00 won in total, including global income tax and additional tax 00 won for the year 2001, global income tax and additional tax 00 won for the year 2002, global income tax and tax 00 won for the year 203, global income tax and additional tax 00 won for the year 203 (hereinafter referred to as “disposition of imposition of global income tax and additional tax for each year”) (hereinafter referred to as “instant disposition”).

F. On March 10, 2009, the Plaintiff filed a request for review with the Commissioner of the National Tax Service for the instant disposition, but the Commissioner of the National Tax Service rendered a decision to dismiss the request on March 30, 2010.

[Ground for Recognition: Facts without dispute, Gap evidence 1, Eul evidence 1 to 3 and 5 (including paper numbers; hereinafter the same shall apply) and the purport of the whole pleadings]

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

1) The disposition of global income tax in 2001 and the disposition of global income tax in 2002 was made after the exclusion period of five years expires, and thus, is unlawful.

2) The instant disposition violates the prohibition of duplicate tax investigations.

3) In order to directly impose the income tax on the representative director based on the recognition and contribution, it is unlawful for the Defendant to impose the instant tax disposition without notifying the Plaintiff of the change in the amount of income even though the representative director notified of the change in the amount of income.

4) The purchase amount of the tax invoice received from the OBK should be recognized as the construction cost since the subcontractor received the tax invoice in the name of OB knc because the subcontractor did not have any business registration, although XX paid the actual labor cost to the leastA and the ABB, the subcontractor, but the subcontractor received the tax invoice in the name of OB knc. Therefore, the Defendant’s act of not recognizing the amount paid to the construction cost as the deductible expenses

5) At the time of the notice of change in the amount of income in XX, the Defendant made a disposition of deficits, even though he did not constitute a reason for the disposition of deficits. Since the disposition of deficits itself was erroneous, the instant disposition based on this premise is unlawful.

6) Even though the Defendant shall give the Plaintiff a notice of change in income amount and impose an additional tax for unfaithful payment from the day following the voluntary payment deadline following the notification, it is unlawful to impose an additional tax for unfaithful payment without giving the Plaintiff a notice of change in income amount.

B. Relevant statutes

It is as shown in the attached Form.

C. Judgment on the assertion regarding the exclusion period of imposition

Where the tax authority deems the amount of gross income leaked to the representative as a bonus and disposes of it as a bonus, the corporation liable to withhold the income tax is established on the date when the notice of change in the amount of income is served on the corporation. Unlike the fact that the person liable to withhold the income tax is the receipt date of the labor provided during the pertinent business year regardless of whether the notice of change in the amount of income was served on the corporation, so the person liable to pay global income tax on the person liable to withhold the income is established at the time when the taxable period to whom the income accrues under Article 21 (1) 1 of the Framework Act on National Taxes (amended by Act No. 9911 of Jan. 1, 201; hereinafter the same shall apply) ends. Accordingly, the taxpayer’s liability to pay global income tax on the recognized amount of gross income accrued in the year 2001 and 202 as a bonus is established on the date when the relevant taxable period expires, and the starting date of the exclusion period is the date before the deadline for filing the income tax (amended by Act No. 8144 of Dec. 30, 20, 601). 60. 20.

Meanwhile, it is difficult to view that: (a) the collection of a false tax invoice from OBk to include the amount of purchase in deductible expenses is an act to evade corporate tax and value-added tax; and (b) it is difficult to view that the Plaintiff, the representative director of XX, who is the representative director, was subject to the disposition of recognition, to evade the income tax imposed due to the prediction of the entire amount; and (c) the income tax from such disposition cannot be deemed a case where a taxpayer evades national tax by fraud or other unlawful acts; and (d) the exclusion period of imposition is five years (see, e.g., Supreme Court Decision 2008Du10522, Dec. 23, 2010).

On the other hand, the defendant asserts that the period of exclusion from the income tax should be calculated from the time when the notice of change in the amount of income is given. However, if the period of exclusion from the income tax is calculated only when the notice of change in the amount of income is given, the tax authorities can give notice of change in the amount of income within the period of exclusion from the corporate tax. In other words, the tax authorities can give notice of change in the amount of income within the period of exclusion from the corporate tax, which is unfair due to the long-term instability in the status of the taxpayer from the time when the exclusion period for the income tax should be calculated, and the substantial status of the original taxpayer should not be more unfavorable due to the tax withholding system that was born

Among the instant disposition, the disposition of global income tax in 2001 and the disposition of global income tax in 2002 was unlawful since the exclusion period was imposed.

D. Determination on the assertion of the violation of the prohibition of double tax investigation

According to Article 81-4(2) of the Framework Act on National Taxes, a tax official may not re-examine the same item of taxation and the same taxable period, except in the case where there are certain reasons. The instant disposition imposing income tax on the Plaintiff, the representative director, after the disposition on deficits in XX, according to the auditing records of the Jungbu Regional Tax Office, and imposing income tax in duplicate does not impose income tax according to the result of a duplicate tax investigation. The Plaintiff’s assertion is without merit.

E. Determination on the assertion that the Plaintiff did not notify the change in the amount of income

Article 192 (1) of the Enforcement Decree of the Income Tax Act provides that the dividend, bonus and other income disposed of (including the cases deemed disposed of pursuant to Article 25 (6) of the Enforcement Decree of the Adjustment of International Taxes Act) by the director of the tax office or the director of the regional tax office who makes the determination or correction of corporate income shall be notified to the relevant corporation by a notice on change of income amount as determined by Ordinance of the Ministry of Strategy and Finance within 15 days from the date of the determination or correction: Provided, That where the location of the relevant corporation is unclear or it is impossible to serve the notice, or where the relevant corporation falls under the provisions of Article 86 (1) 1, 2 and 4 of the National Tax Collection Act, it shall be notified to the relevant stockholder, the relevant bonus and other income.

Since the Defendant, around January 7, 2005, notified the change in the income amount of this case to XX, it does not require the Plaintiff to separately notify the change in the income amount. Therefore, even if it did not notify the Plaintiff of the change in the income amount, the disposition of global income tax in 2003 cannot be deemed unlawful (i.e., the added health class, the Plaintiff was the representative director of XX at the time when the notice of the change in the income amount of this case reached XX, and thus, it is deemed that the Plaintiff was well aware of the details of the notice of the change in the income

F. Judgment on the assertion that construction cost was used

Gap evidence Nos. 2 through 8, Gap evidence Nos. 16 to 21, and the court's order to submit financial data to the President of the NA branch, the President of the NA branch, the President of the NA branch, and the President of the NA branch, and the NA witness testimony alone are insufficient to acknowledge the facts alleged by the plaintiff, and there is no other evidence to acknowledge them.

Rather, in light of the following circumstances, Gap evidence 1 and Eul evidence 6 and the overall purport of the pleadings, it is legitimate to regard the tax invoice received from O2K as the processed tax invoice for the year 2003 under the premise that the amount would be attributed to the plaintiff. ① The amount of revenue in 2002 is KRW 00,000, and the supply value on the tax invoice received from O200 is KRW 00,000. ② The amount was notified of the change of the income amount in this case and did not raise any objection, and ③ the O200,000,000 KRW 10,000,000,000,000 KRW 20,000,000,0000, and the portion was paid to the plaintiff on July 30, 2002.

G. Determination on the assertion regarding write-off

In full view of the purport of the argument in Gap evidence No. 24 and No. 27, around January 5, 2005, the LY Financial Cooperative's certificate of 190 (000 won per unit) was held around January 5, 2005, and on the balance sheet as of December 31, 2004, it entered that there was KRW 000 of the outstanding construction amount and KRW 000 of the tangible assets, such as vehicles, etc., in 2004. The defendant attached the certificate of investment by the Construction Financial Cooperative on February 17, 2005. However, even though the defendant reported the closure of the business on September 28, 2005, and the value-added tax and corporate tax imposed under XX were KRW 000 and KRW 00, as seen earlier.

Therefore, even if the Defendant seized the investment certificates of the Construction Financial Cooperative, it is unclear whether the outstanding amount in the balance sheet exists or not, and the existence of tangible assets was also unclear because of the discontinuance of the business in XX, and in the situation where the assets do not fall short of the value-added tax and the corporate tax imposed in XX, it is legitimate to write off the income tax that the Defendant collected and disposed of in XX because it did not have the assets in XX. The Plaintiff’s assertion

H. Determination as to the assertion on additional tax

As long as the notice of change in the instant income amount was given in XX, it is unnecessary to give notice of change in income amount to the Plaintiff. The Plaintiff’s assertion on a different premise is without merit.

3. Conclusion

Of the judgment of the first instance court, the part against the Plaintiff regarding the disposition of global income tax in 2001 and the disposition of global income tax in 2002 shall be revoked, and the disposition of global income tax in 2001 and the disposition of comprehensive income tax in 2002 pertaining to the revoked part shall be revoked. The remaining appeal filed by the