Cho High-2016-Seoul Government-2728 ( December 06, 2016)

Since the data submitted by the Plaintiff does not constitute a case where the Defendant does not have any way to disclose the actual income amount, the requirements for estimated taxation cannot be deemed to have been satisfied.

In calculating the tax base of the Plaintiff, it is difficult to view that the Plaintiff’s important part is not reliable because it is false, or there is no other evidence to acknowledge it.

Article 80 of the Income Tax Act shall be decided and corrected.

2017Guhap56261 global income and revocation of such disposition

O*

00. Head of tax office

May 31, 2018

June 28, 2018

1. On November 10, 2015, the imposition of global income tax of KRW 203,539,95 (including additional tax) imposed by the Defendant against the Plaintiff for the year 2013 shall be revoked.

2. The costs of the lawsuit are assessed against the defendant.

Cheong-gu Office

The same shall apply to the order.

1. Details of the disposition;

A. The Plaintiff is an individual entrepreneur who runs a housing construction and sales business from August 30, 201 to October 17, 2013 under the trade name *** Housing, and did not file a comprehensive income tax for the year 2013.

B. Under the proviso to Article 80(3) of the Income Tax Act (amended by Act No. 12169, Jan. 1, 2014; hereinafter the same shall apply) and Article 143(3) of the Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 25193, Feb. 21, 2014; hereinafter the same shall apply), the Defendant considers that the amount of income for the year 2013 cannot be calculated by books or other evidentiary documents, and determined the amount calculated by multiplying the amount of income for the year 2013 by 1,721,945,250 [1,796,500,500 won] of the amount calculated by multiplying the amount of income for the year 2013 by 1/209 of the standard expense rate x 3050,000 won [1,796,500 won x 1/209] of the amount of income for the year 20140, x 9609405

*The standard expense rate of the construction/residential building development/supply business (less than five years in land possession) under Article 3 of the Notice of Allocation Rate for the Year 2013 (Public Notice of National Tax Service No. 2014-14) (No. 2014-14)

** Simple expense rate of construction/residential building development/supply business (land ownership less than five years) (business code 451102) under Article 3 of the National Tax Service Notice (Public Notice No. 2014-14) of 2013

*** Article 67 of the former Enforcement Rule of the Income Tax Act (amended by Ordinance of the Ministry of Strategy and Finance No. 556 of March 16, 2016)

C. On December 11, 2015, the Defendant revised the amount of KRW 7,562,040 as additional tax for failure to submit a certificate of faithful reporting on December 11, 2015 (hereinafter referred to as the “instant previous disposition”), on the ground that the Defendant applied the additional tax for failure to submit a certificate of faithful reporting and the additional tax for failure to submit a certificate of faithful reporting (including additional tax).

D. On February 5, 2016, the Plaintiff appealed against the instant disposition, and dismissed the Defendant’s objection. On June 8, 2016, the Plaintiff filed an appeal with the Tax Tribunal, but was dismissed on December 6, 2016.

[Ground of recognition] Unsatisfy, Gap evidence 1, 2, Eul evidence 1, 8, 10

Each entry, the purport of the whole pleadings, including branch numbers,

2. Whether the instant disposition is lawful

A. The parties' assertion

1) The plaintiff's assertion

Since the Plaintiff filed an objection against the Defendant and submitted sufficiently the account books on the income amount attributed to year 2013 in the course of the instant lawsuit, the Defendant determined the Plaintiff’s income amount by means of a field investigation based on the above account books, etc. and cannot be determined by means of an estimate investigation. Therefore, the Defendant’s disposition that determined the Plaintiff’s income amount attributed to year 2013 is unlawful.

2) The defendant's assertion

Article 143 (1) 1 of the Enforcement Decree of the Income Tax Act on the ground that “where there is no necessary account books and documentary evidence in calculating the tax base or where the important part is incomplete or false,” the Defendant’s disposition that determined the Plaintiff’s income amount for the year 2013 by means of an estimate investigation is lawful.

B. Relevant statutes

It is as shown in the attached Form.

(c) Fact of recognition;

1) The Plaintiff newly built and sold a house on August 30, 201, Seoul, 00-dong 00, 500-00, 309.1 square meters (hereinafter referred to as “instant land”). The Plaintiff registered the business as a trade name *** house, and closed the business on October 17, 2013.

2) On June 4, 201, the Plaintiff entered into a sales contract with the Yellow City, and the instant land and its ground buildings (hereinafter referred to as “the instant land, etc.”) with the amount of KRW 1.12,00,000,000,000,000 for the purchase price, and KRW 100,000,000,000 for the contract deposit of KRW 200,000,000 for the remainder payment of KRW 100,000 until June 24, 2011, and the intermediate payment of KRW 52,00,000 for the remainder payment of KRW 42,00,00 until August 30, 201 (On the other hand, the Plaintiff appears to have entered into a new sales contract with the Plaintiff on June 22, 201, which changed the contract date to the above contract date (hereinafter “the instant sales contract with the Plaintiff”).

3) On August 26, 2011, the Plaintiff completed the registration of ownership transfer on the instant land on the grounds of sale as of June 22, 2011, and on the same day, the registration of establishment was completed on the instant land, etc. with the mortgagee BB agricultural cooperatives and the maximum debt amount of KRW 780 million.

4) The Plaintiff obtained a building permit on August 2, 201 and started the construction on the instant land on the 29th of the same month, and newly built a multi-household (multi-household) building (multi-household) building on the instant land (hereinafter “instant building”). On April 3, 2012, the Plaintiff obtained approval for use of the said building. The first floor of the said building is a stairs room, and three sections for exclusive use on each floor from the second to the fifth floor exist. The Plaintiff concluded a sales contract on each of the said sections for exclusive use as listed below from March 19, 2012 to April 2, 2013.

Section 4

The date of conclusion

Buyer

Sales proceeds;

201

*. *, 2013

Kim*

177,000,000

202

*. *, 2012

Power** Foreign Affairs Association

149,000,000

203

*. *, 2013

C*

178,000,000

302

*. *, 2012

Park*

145,000,000

303

*. *, 2012

Red*

175,500,000

401

*. *, 2012

**

179,000,000

402

*. *, 2013

L**

149,000,000

501

*. *, 2012

Gangwon*

175,000,000

502

*. *, 2013

Yellow*

149,000,000

503

*. *, 2012

Kim*

135,000,000

5) On February 5, 2016, the Plaintiff dissatisfied with the instant disposition filed an objection with the Defendant, and filed a global income tax return for the amount of KRW 1,796,50,000, and the amount of income for KRW 149,421,810, which was calculated as the global income tax return for the year 2013, but did not submit relevant books and evidentiary documents. The Defendant filed a request for correction to the Plaintiff on February 16, 2016. The Plaintiff submitted a global income tax return for the year 2011, a financial statement for the global income tax for the year 2011, and a ledger for each account from 2011 to 2013, but did not submit evidentiary documents.

6) The details of income statements from the year 2011 to the year 2013 submitted by the Plaintiff are as follows: KRW 1,571,00,653 of the sales cost in 2013 is the sum of KRW 1,566,050,653 of the inventory value of the building based on the sales cost of the sale cost of the building for sale in units and KRW 4,950,00 of the manufacturing cost of the building for sale in units and KRW 1,589,537,287 of the building for sale in units and KRW 138,778,36 of the total construction cost for the year 2012 and KRW 1,589,537,287 shall be the total construction cost for the year 2011.

7) The details of construction cost specifications submitted by the Plaintiff from the year 2011 to the year 2013 are as follows. The total construction cost of KRW 1,589,537,287 is the total amount of KRW 1,491,042,089, labor cost of construction raw materials, KRW 86,209,00, and KRW 12,286,198.

8) On June 22, 2011, the Plaintiff received a receipt that KRW 100 million was paid out of the down payment 200 million of the instant land, etc. from the YellowA. On August 26, 2011, the Plaintiff transferred the remainder of KRW 420 million of the instant land, etc. to the YellowA’s account. On the other hand, the YellowA appeared as a witness in this court and stated as follows.

- On June 22, 2011, the instant land, etc. was sold to the Plaintiff at KRW 1.12 billion, and the down payment is KRW 200 million, the intermediate payment is KRW 500 million, and the remainder is KRW 420 million.

- The Plaintiff received the full payment of KRW 1.12 million from the Plaintiff, and the remainder received through the account transfer was paid in cash at the real estate intermediary.

- At the time of the conclusion of the instant sales contract, the Plaintiff leased a total of 2 households, 2 households, 3rd, and 2 households in the underground of the instant multi-household building, which were located on the instant land. The Plaintiff received the sales amount from the Plaintiff and returned the lease deposit to the lessee.

9) The Plaintiff received each purchase tax invoice listed in the following table from the second to the first period from 2011, 2013.

10) According to the National Tax Service’s computerized data, the Plaintiff’s supply value on the list of the second purchase tax invoices in 201 was 25,6930,000 won (the total supply value on the list of the second purchase tax invoices in 201 and the first purchase tax invoices in 201, other than the electronic purchase tax invoices issued byCC firms on July 11, 201 and tax invoices issued on December 27, 2011). The supply value on the list of the first purchase tax invoices in 2013 is confirmed to be 4,50,000 won. The Plaintiff’s total supply value on the list of the first purchase tax invoices in 2011 is confirmed to be 25,000 won against Jeong F, the husband of the Plaintiff, and the total payment amount on the daily employment income in 2013 is confirmed to be 1,000,000 won for E.

11) On August 26, 2011, the Plaintiff concluded a loan agreement with a maturity of KRW 00,00 on August 26, 2013; and the amount of the loan agreement as KRW 540,00,00 (hereinafter “instant first loan”); with respect to the said loan, the Plaintiff repaid the total amount of KRW 56,686,69 as interest during the period from August 28, 201 to April 28, 2013. In addition, on July 12, 2011, the Plaintiff’s spouse LF concluded a loan agreement with H Bank from July 12, 201 to July 12, 201 (hereinafter “instant second loan”); from July 12, 2011 to July 12, 2016 to “from July 2015, 205,” each of the instant loans was repaid as KRW 581,516.205”

12) From the bank account (Account Number 00-000-0000, an account number of 00-000, hereinafter referred to as “the bank account of this case”) in the name of the Plaintiff, which appears to have been used to cover the costs necessary for the construction of the building of this case, the sum of KRW 86,209,000 was transferred in the year 201 as listed below.

13) From the instant bank account to the year 2013, the sum of KRW 57,420,000 was transferred as listed below.

14) The Plaintiff issued a withholding tax receipt for business income for the year 2013 with the content as listed below. On the other hand, among the listed income earners, Kim** (4,00,000), Park* (3,00,000) (3,000), grandchildren* (4,835,00) (4,835,00) reported global income tax relating to the amount received from the Plaintiff (*).

Date of Payment

Income Earners

Total amount of payment (won)

Withholding Tax (cost)

Jinay

*. *, 2013

Korea*

5,000,000

165,500

401 The balance payment date

*. *, 2013

Ma**

3,702,160

122,160

*. *, 2013

Song*

2,068,240

68,240

302 The payment date of the balance

*. *, 2013

Ma**

2,068,240

68,240

*. *, 2013

L**

4,136,490

136,490

503 The balance payment date

*. *, 2013

Ma**

2,068,240

68,240

*. *, 2013

UN*

3,102,370

102,370

501 The balance payment date

*. *, 2013

New*

500,000

165,000

202 The payment date of the balance

*. *, 2013

Ma**

4,136,490

136,490

*. *, 2013

Kim*

3,102,370

102,370

*. *, 2013

Kim*

1,809,710

59,710

201 The balance payment date

*. *, 2013

Kim*

5,000,000

165,000

402 The payment date of the balance

*. *, 2013

Ma**

4,136,490

136,490

*. *, 2013

Park*

3,000,000

9,000

*. *, 2013

Kim*

4,000,000

132,000

*. *, 2013

L**

4,835,000

159,550

[Reasons for Recognition] Unsatisfy, Gap evidence 3 to 20, Eul evidence 2 to 5, and evidence 8

the testimony, the whole purport of the oral argument of the Republic of Korea

D. Determination

1) In principle, the tax base and tax amount of global income tax shall be determined by the actual amount revealed by the method of a field investigation. In order to determine them by the method of a field investigation, it shall be exceptionally permissible only when there is no taxpayer’s account book or documentary evidence, etc., or when there is no other method that the tax authority can disclose the actual amount of income without reliability because the important portion is insufficient or false. The burden of proof regarding the requirements for the global income tax exists on the tax authority, barring special circumstances, barring any special circumstance, if the tax authority fails to prove the requirements for the global income tax in the lawsuit, it shall be revoked in its entirety (see Supreme Court Decision 98Du915, Oct. 8, 199). In addition, in the lawsuit seeking the revocation of a tax disposition, a party to the lawsuit can assert that all the materials submitted by the court at the time of the closing of argument in the lawsuit seeking the revocation of the tax disposition and that the tax base shall not be determined by the method of a field investigation when the account book and other documentary evidence were produced in the lawsuit (see Supreme Court Decision 8686Nu6.

B) Comprehensively taking account of the following circumstances acknowledged by the facts acknowledged as above and the purport of the entire pleadings, it is difficult to view that the Plaintiff did not have necessary account books and documentary evidence in calculating the tax base in 2013, or did not have credibility because the important parts are incomplete or false, or there is no other evidence to acknowledge otherwise.

① The main part of the sales cost of the income statement for the year 2013 submitted by the Plaintiff is the total construction cost for the year 2011, and KRW 1,589,537,287 is the total construction cost for the year 2011, including KRW 1,491,042,089, labor cost, KRW 86,209,00, and KRW 12,286,198. However, as seen below, there is considerable room to view that the fact that a considerable portion of the income statement was actually paid or actually paid by evidentiary materials submitted by the Plaintiff in the instant lawsuit is high.

The Director General of the Account (raw Materials) of 2011, which was submitted by the Plaintiff to the Corporation, specified the details of KRW 1,491,042,089 as the above construction raw materials, and KRW 1,155,038,910 among them, is the expenses paid in connection with the acquisition of the pertinent land, etc. ( KRW 1,120,000,000, and KRW 26,038,910, including the purchase price of the instant land, etc., acquisition tax, and KRW 9,00,000 in connection with the acquisition of the instant land, etc.). In full view of the following circumstances, the Plaintiff appears to have actually paid the said expenses.

(a) According to the instant sales contract, the transfer registration under the Plaintiff’s name was completed for the instant land. It clearly states that yellowA, a seller of the instant land, etc., has received full payment from the Plaintiff by account transfer and in cash. There is no circumstance to suspect the credibility of the said statement.

(b) Although there is no financial evidence related to the payment of intermediate payment of KRW 500 million for the instant land, even if only the publicly announced price of multi-household housing in the instant land at the time of the conclusion of the instant sales contract, exceeds KRW 622,00,000 that the Defendant actually paid to sulfurA on the ground of the existence of financial evidence, and the remainder of the sales price, excluding the above KRW 420,000,000,000, is stated to the purport that the Defendant was paid in cash at the real estate broker office. At the time of the conclusion of the instant sales contract, YellowA leased six households among the multi-household housing on the instant land. As at the time of the conclusion of the instant sales contract, it is difficult to view that the intermediate payment of KRW 50,00,00,000 was not paid in cash for the refund of the remainder of the lease deposit, given that there is no financial evidence that there is no possibility to receive the intermediate payment of the instant land, etc. for the refund of the lease deposit.

(c) On July 12, 201, at the time of the intermediate payment of the instant land, the Plaintiff’s spouse received the instant second loan from HH bank. On August 26, 2011, the remainder payment date, the Plaintiff obtained the instant first loan with the amount of loans of KRW 540 million at KRW 00,000,000,000,000. On the same day, on the instant land, the mortgage-mortgage was completed with BB agricultural cooperatives and the maximum debt amount of KRW 780,000,000,000.

(d) The Plaintiff agreed to pay KRW 10,080,000 as brokerage commission in connection with the sale and purchase of the instant land, etc. at a description of confirmation of the object of brokerage prepared on June 22, 2011, and the Plaintiff paid KRW 26,038,910 as acquisition tax, etc. on the instant land, etc.

In most of the expenses for the remaining construction raw materials of the Republic of Korea (i.e., KRW 1,491,042,089 - KRW 1,155,038,910) (i.e., KRW 1,491,04,089 - KRW 1,155,038,910), most of the expenses for the construction of the building of the building of this case are considered as follows: (ii) there is a tax invoice on the bank account of this case that the Plaintiff appears to have used for the purpose of paying expenses for each of the expenses; or (iii) there is a tax invoice that accurately satisfies or considerable amount of the expenses; and (iv) there is a tax invoice that does not exist both financial evidence and tax invoice (e.g., sound portion) and the total expenses that do not exist are merely KRW 6,50,000 *****. (On the other hand, the defendant does not have specific details, but it can be considered necessary expenses on the ground that financial evidence evidence exists

**** QQ건재의 경우 그 대표자로 보이는 윤LL에게 2011. 9. 3. 350,000원, 2011. 10. 31. 4,000,000원이 각 지급된 내역이 존재하기는 하나, 그 지급일자와 금액이 정확히 일치하지 않아 금융증빙과 세금계산서 모두 존재하지 않는 비용으로 보아 산정하였고, 국세청에 신고가 되지 않은 전자 외 세금계산서 관련 비용 또한 금융증빙과 세금계산서 모두 존재하지 않는 비용으로 보아 산정한 금액이다

In this regard, the Defendant asserts that, among the above expenses, expenses paid as interest cannot be recognized as business relations and can not be included in necessary expenses. However, as seen above, the Plaintiff and his spouse fixed FF are deemed to have received each of the instant loans for the payment of the purchase price of the instant land, and the interest expenses included in the above construction cost are deemed to have been repaid as interest on each of the above loans. Thus, the Defendant’s above assertion is difficult to accept.

A total of KRW 86,209,000, which was submitted by the Plaintiff to the Director General of the Account in 2011, is deemed to have been disbursed as personnel expenses for human resources related to concrete, steel products, facilities, cleaning, and others. From September 4, 2011 to December 30, 201, the date following the commencement of the construction of the building of this case, the Plaintiff used the construction of the building of this case for the purpose of expenditure of the said construction cost. The details actually paid in the sum of KRW 86,209,00 in the bank account of this case, as shown in the Director General of the Account, are confirmed. It is highly probable to deem that the total construction cost of the last time in 2011 was actually paid KRW 86,209,00,000, as well as the actual payment of the labor cost of KRW 1,589,537,287.

In this regard, the Defendant asserts that, in the National Tax Service’s computerized data of 2013, the payment details of the above labor cost are not verified, and the personal information of the recipient of the above cost is not verified, and there is no wage ledger or work book, and that the receipt or payment record of labor income under the “public notice of the scope of purchase costs, rent, and the type of evidentiary documents” did not have been submitted to the competent tax office, and that the above payment record or payment record of labor income under the “public notice of the scope of purchase costs and rent and the type of evidentiary documents” cannot be recognized only by the head of the above account and the financial data. However, unless there are special circumstances to suspect the credibility of the payment, the Defendant’s personal information of the payer is not verified or there is no document such as the wage ledger, work book, etc., and the above public notice asserted by the Defendant is difficult to accept the Defendant’s assertion on the type of evidentiary documents, since it is related to the deduction of the income amount by standard expense method under the delegation of Article 143(3)1 and (5) of the Enforcement Decree.

㉣ 원고가 제출한 2011년도 계정별원장(장비사용료)에 2011년도 당기총공사비를 구성하는 경비 12,286,198원 중 장비(포크레인, 펌프카, 지게차) 사용료 3,890,000원의 지급내역이 기재되어 있는데, 위 계정별원장에 기재된 내역과 동일하게 장비사용료 3,890,000원이 실제로 지급된 금융증빙이 존재하고, 피고 또한 위 경비 12,286,198 원 중 장비사용료 3,890,000원은 필요경비에 포함되어야 함을 인정하고 있다.

② Of the profit and loss statement for the year 2013 submitted by the Plaintiff, the remainder expenses excluding KRW 1,56,050,050,653 of the inventory amount of the basic completed building in the year 2013, are 4,950,00, sales expenses and management expenses for the buildings completed at the time, 27,843,753 (miscellaneous 25,00,000, welfare expenses, 8,800, entertainment expenses, 757,200, communication expenses, 5,760, 1,760, 1,130, 1,000, 31,00, 823,813, transportation expenses, and 87,160,000, 12,129,382, and 382, as seen below, there is considerable room to deem that each of the above expenses has been actually or actually paid.

4,950,00 won for the manufacture of the building completed at the time of the 2013 Public Works Costs, and the details of payment of KRW 4,950,000 to W Timber on May 6, 2013 in relation to the floor repair, etc. of the building of this case, to the Director of the Accounting Division (raw Materials) of the 2013 Public Works Costs submitted by the Plaintiff. This is consistent with the details of electronic purchase tax invoices issued from W Timber on May 6, 2013 by the Plaintiff and reported to the National Tax Service.

Of the sales expenses and management expenses, there is a director of the account division in 2013, stating the details of welfare expenses, entertainment expenses, communication expenses, water and mineral heat expenses, vehicle maintenance expenses, transportation expenses, and expendable goods expenses, and it is confirmed that there was a substantial portion of the expenses indicated in the director of the account division in the financial transaction (Evidence A No. 18).

A president of each of the instant loans appears to be the details of redemption of interest in 2013 relating to each of the instant loans for the purpose of paying the purchase price of the instant land, etc. As seen earlier. The actual amount of redemption of interest in 2013 (=a total of KRW 8,584,062 (=a total of KRW 3,450,473 on January 27, 2013 + KRW 3,450,473 + KRW 2,703,619 on February 24, 2013 + KRW 2,703,619 + KRW 20,220,402 on March 24, 2013 + KRW 200 on April 1, 2013 + KRW 2036,36,365 on April 28, 2013 + KRW 2053,36,365,204,365,205.

③ Meanwhile, although the Plaintiff did not include the above amount in the account book prepared by the Plaintiff, the Plaintiff paid KRW 57,420,000 in total in 2013 to **, etc. as seen earlier, the Plaintiff issued a withholding tax receipt in relation to the above amount of expenditure, and there is considerable room to deem that the Plaintiff paid the above amount as commission for the sale of the building since the payment date of a considerable portion of the above amount corresponds or is close to the remainder payment date of the section for exclusive use in the building of this case. Kim* (4,00,000), Park* (3,00,000,000), Park* (3,000,000,000), ** (4,835,000) (4,835,000) without relation to the entry of the account book.

C) Therefore, as long as the Plaintiff submitted necessary books and documentary evidence in calculating the tax base and amount of global income tax for the year 2013 prior to the time of closing the argument in the instant lawsuit, and as long as the important parts are incomplete or false, it cannot be deemed that the requirements for estimated taxation have been satisfied, the instant disposition based on the estimation method has to be revoked in its entirety due to its illegality.

3. Conclusion

Therefore, the plaintiff's claim is reasonable, and it is so decided as per Disposition.