Review Division 2014-0072 ( July 29, 2014)

The transfer of real estate in this case cannot be deemed as a comprehensive transfer or acquisition of business assets.

The transfer of a building among the real estate No. 1 of this case constitutes a case where a business-related goods are transferred by reason of contractual causes, and this constitutes a "supply of goods subject to value-added tax, regardless of whether profit-making purposes or the transfer of the building is continuous and repeated."

Daejeon District Court 2014Guhap1034 Such revocation as Value-Added Tax, etc.

OO

00. Head of tax office

December 25, 2015

on October 25, 2015

1. The plaintiff's claim is dismissed.

2. The costs of lawsuit shall be borne by the Plaintiff.

Cheong-gu Office

The Defendant’s disposition of imposition of KRW 110,391,089, which was imposed on the Plaintiff on April 1, 2014, shall be revoked.

1. Details of the disposition;

가. 원고는 2003. 4. 15. 대전 00구 00동 ###-1 대 244.7㎡와 그 지상의 철근콘크리트조 숙박시설 지하 1층 지상 7층의 건물(이하 '이 사건 제1부동산'이라 한다)에 관하여 소유권이전등기를 마쳤다.

B. The plaintiff registered his/her business with his/her trade name "qmt", "place of business", "place of business", "place of real estate of this case": "real estate/ lodging business, category of business": "lease/n", and "date of business opening", and thereafter, he/she has operated a real estate rental business using the real estate of this case since that time.

C. On November 9, 2012, the Plaintiff: (a) exchanged the instant real estate with kyl’s mother; and (b) exchanged the instant real estate with 107-9 square meters and 195 square meters and buildings on the ground and mentmen’s store and mentmen’s room/office room/office room; (c) sold the instant 1 real estate for the purpose of using it in the real estate registration, etc.; and (d) exchanged the instant 1 real estate with kyl’s mother with kyl with the sales contract stating that the instant 1 real estate is sold for 1.5 billion won and that the instant 2 real estate is sold for 50 million won.

D. On November 19, 2012, the Plaintiff filed a report on the closure of the business registration under the above B, and filed a business registration with the name of kbk, referring to the location of the place of business, referring to the location of the second real estate, and referring to the type of real estate business: Lease.

E. On April 1, 2014, the Defendant notified the Daejeon Regional Tax Office that kyl’s transferee of the instant first real estate is engaged in accommodation business rather than real estate leasing business, and on the ground that the transfer of a building among the instant first real estate constitutes “supply of goods subject to value-added tax”, the Defendant issued a notice of rectification and notification of KRW 118,636,520, the value-added tax of KRW 2, 2012 calculated by deeming the transfer value of the instant first real estate as 1.5 billion, based on the reason that the transfer of the building among the instant first real estate constitutes “supply of goods subject to value-added tax.”

F. On May 12, 2014, the Plaintiff appealed and filed a request for review with the National Tax Service on May 12, 2014. On July 29, 2014, the National Tax Service rendered a decision that “The National Tax Service received KRW 796 million from loans to the instant real estate 1, and KRW 100 million from the lease deposit the Plaintiff paid to the Plaintiff by this Tyl, and kyl considers that “The value-added tax base and tax amount shall be KRW 1,396 million from the instant real estate 1 in light of the fact that kyl transferred the instant real estate 2 to the Plaintiff at KRW 500 million.”

G. On August 12, 2014, the Defendant issued a correction and notification of KRW 110,391,090 [including additional tax (i.e., KRW 21,036,825 + KRW 8,935,825 + KRW 12,101,002] of value-added tax for the second year of value-added tax for the year 2012 (hereinafter referred to as the “instant disposition”) by reducing KRW 8,246,430 to the Plaintiff on August 12, 2014 (hereinafter referred to as the “instant disposition”).

Facts without any dispute, Gap's 1, 3-1, 2, 5-1, 2, 3, 6, 7-1, 12-20, Eul's 1-1, 2, and 2, and the purport of the whole pleadings.

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

1) Matters related to imposition of value-added tax

In order to impose value-added tax on the sale of real estate, the real estate should be traded either as a business or as a continuous and repeated intention. However, since the sales contract of this case is not a person who runs the real estate sales business, and the Plaintiff is not a continuous and repeated transaction, the transfer of real estate of this case cannot be subject to value-added tax. Even if it is not so, since the Plaintiff comprehensively transferred to kyl the entire business of accommodation and lease business including the real estate of this case, it is not subject to value-added tax since the Plaintiff comprehensively transferred to kyl the entire business of accommodation and lease business including the real estate of this case. Thus, the Plaintiff is not subject to value-added tax because it constitutes "transfer of business" under Article 6 (6) 2 of the former Value-Added Tax Act (wholly amended by Act No. 11873, Jun. 7, 2013; hereinafter the same shall apply) and Article 17 (2) of the Enforcement Decree of the same Act (wholly amended by Presidential Decree No. 24638, Jun

2) The calculation of value-added tax

Even if the transfer of the instant 1 real estate becomes subject to value-added tax, the instant value-added tax computed by the Defendant is inappropriate as follows, and the instant disposition is unlawful.

(A) relating to the calculation of the tax base;

(1) The transfer value of the first real estate

The Plaintiff acquired KRW 54 million for the obligation to return the lease deposit of the instant property, upon receiving payment in kind as part of the purchase price of the instant real estate. Accordingly, the actual value of the instant movable property No. 2 is KRW 446 million, and reflecting this, the transfer value of the instant movable property No. 1 is KRW 1.342 million (i.e., KRW 796 billion + KRW 100 million for the lease deposit + KRW 1.46 million for the lease deposit + KRW 46 million for the second attached movable property).

Doz. concerning calculation of the value of the building

The value of the portion of the land among the real estate No. 1 of this case is KRW 34,258 million based on the publicly assessed individual land price of KRW 1.4 million (i.e., KRW 1.4 million x KRW 244.7 square meters). The value of the building portion is KRW 734,825,350 based on the tax base price. Based on the above value, if the value of the real estate No. 1 of this case is calculated based on the ratio of the value of the land and the building value of KRW 1.34,200,00,000, the value of the building portion is KRW 715,287,4721). However, the Defendant calculated the value of the real estate No. 1 of this case by deeming the value of the building as KRW 893,582,555.

B) Deduction of input tax amount

The input tax amount of KRW 1,060,000 on the registration fee, brokerage fee, etc. required for a transaction should be deducted as an input tax amount. In addition, where value-added tax is imposed on the real estate transaction, it would result in imposing the total amount of output tax without deducting the actual input tax amount. As such, where the transaction amount is larger as in the instant case, the input tax amount should be recognized even if the additional tax taxable period on the purchase and sales differs from

C) Improperity of imposing additional tax

Since the Plaintiff did not intentionally avoid the obligation to pay value-added tax, the imposition of penalty tax is unfair.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) Whether the transaction of building among the real estate No. 1 of this case is subject to value-added tax

A) First, we examine whether the act of transferring a building among the real estate No. 1 of this case constitutes “supply of goods” under the Value-Added Tax Act.

According to the relevant provisions of the Value-Added Tax Act and the Enforcement Decree of the Value-Added Tax Act, the supply of goods subject to value-added tax refers to the delivery or transfer of goods under all contractual or legal grounds, and the taxpayer is a person who independently supplies goods or services for a business regardless of whether it is for profit-making purposes. Thus, in the event that an entrepreneur delivers or transfers goods due to contractual or legal grounds, it is subject to the imposition of value-added tax unless there is a special provision that it is exempted from or exempt from value-added tax. In addition, in the event that an entrepreneur continues to supply goods or services continuously and repeatedly as its main business is not for the supply of goods or services, it is subject to taxation regardless of whether the purpose of supply is to maintain or expand the business, or for liquidation, reorganization or discontinuance of business (see, e.g., Supreme Court Decision 2006Du2459, Jul. 24, 2008).

The facts that the Plaintiff acquired the instant real estate No. 1 and operated a real estate rental business on April 15, 2003 and exchanged it with the real estate owned by kyl and closed on November 19, 2012 after it was exchanged with the real estate on November 9, 2012 are as seen earlier, and kyy may recognize the fact that the Plaintiff completed the registration of ownership transfer with respect to the instant real estate No. 1 on November 14, 2012 and registered the business as 'qmt' and the type of business as 'nmt business' on November 12, 2012.

Examining these facts in light of the legal principles as seen earlier, the Plaintiff’s transfer of the building among the real estate No. 1 of this case constitutes a business-related goods that are subject to the transfer of business-related goods due to contractual causes, which constitutes “supply of goods subject to value-added tax regardless of whether for-profit purposes or the transfer of the building continues and repeated.”

B) Next, we examine whether the act of transferring the first real estate of this case constitutes “transfer of business”.

The transfer of a business not deemed the supply of goods under Article 6(6) of the former Value-Added Tax Act and Article 17(2) of the Enforcement Decree thereof refers to the comprehensive transfer of physical and human facilities, rights, and duties, etc. including business property, by each workplace to replace only the management body while maintaining the identity of the business. Thus, the business must be separated from the management body as an organic combination of human and physical facilities so that social independence can be recognized (see, e.g., Supreme Court Decision 2004Du8422, Apr. 28, 2006).

The fact that Kyl, from the time of completion of the registration of transfer of ownership with respect to the real estate No. 1 in this case, the real estate No. 1 in this case started not a real estate leasing business, but a field of business operation is as seen earlier. According to the respective statements in the evidence No. 7-1 and No. 4, a sales contract delivered between the plaintiff and kyl can be acknowledged that only the contents ordinarily entered in the real estate transaction, such as the object of sale, the purchase price, the delivery date of the object of sale, etc., and that kyl does not have any indication that kyl comprehensively

It seems that there is no circumstance to deem that the legal principles as seen earlier and the human, material, rights, and obligations of the real estate rental business carried out by the Plaintiff have been comprehensively transferred to kyl.

In light of the fact that the act of transferring a building among the real estate No. 1 of this case is not subject to transfer by specifying only the building which was provided for the business rather than that that the rights and obligations regarding the real estate rental business operated by the plaintiff were comprehensively transferred while maintaining its identity.

C) Ultimately, the transfer of a building among the real estate No. 1 of this case constitutes value-added tax assessment. The Plaintiff’s assertion on this part cannot be accepted.

2) Whether the calculation of value-added tax is appropriate

A) As to the assertion regarding calculation of tax base

(1) The transfer value of the first real estate

In an administrative litigation seeking revocation of a taxation disposition on the grounds of illegality, the tax authority bears the burden of proving the legality of the taxation disposition and the existence of the taxation requirement fact. The burden of proving the value of the goods, which are the basis of the determination of taxable income, is also the principle that the tax authority bears the burden of proving the value of the goods. However, as long as the tax was imposed on the basis of the value of the goods reported by the tax authority based on the value of the goods, the taxpayer who is easy to present books and documentary evidence, etc. (see, e.g., Supreme Court Decision 2005Du16406, Apr. 14, 2

In this case, the fact that the sales contract was made up between the Plaintiff and the Kyl with respect to the instant real estate No. 1.5 billion won, as seen earlier, and that the Plaintiff reported the transfer value as KRW 1.5 billion at the time of filing a transfer income tax return on the instant real estate No. 1.5 billion, and kyl reported the transfer value as KRW 50 million at the time of filing a transfer income tax return on the instant real estate No. 2.50 million, and the Plaintiff reported the tax base of KRW 508,781,864 at the time of filing a transfer income tax return on the instant real estate No. 2.

In light of the above legal principles and the fact that the Plaintiff did not present an exchange contract, which appears to have been prepared by exchanging the real estate Nos. 1 and 2 of this case with kyl, even though the National Tax Service, in the process of the request for review, determined that the total amount of KRW 796 million and KRW 100 million for loans to the real estate No. 1 of this case, which kyl acquired by kyl, and KRW 1.396 billion for the security deposit, and KRW 500 million for the real estate No. 2 of this case, the Plaintiff was liable for asserting that the value of the real estate No. 1 of this case is not 1.5 billion.

◎ 이 사건 제1부동산에 관한 2012년 제2기 부가가치세 과세표준 합계

: 970,971,753 won (=10,818,578 won + ② 960,153,175 won)

(1) The base of value-added tax for the second year 2012 related to the Plaintiff’s lease business: 10,818,578 won.

(2) The value of the first real estate in this case at the time of sale: 960,153,175 won

0

0

The actual transaction values of the Corporation: 1,500,000 won

shall not be deemed to have been dismissed.

Therefore, it is reasonable to view the transfer value of the instant real estate No. 1 as KRW 1.5 billion, and it does not change even if the Plaintiff acquired the repayment obligation of the deposit of KRW 54 million with respect to the instant real estate No. 2 from Kyl.

Doz. concerning calculation of the value of the building

According to Article 48-2 (4) 1 of the Enforcement Decree of the Value-Added Tax Act, where an entrepreneur supplies land and a building built on the land and other structures together, the supply price of the building is based on the actual transaction price. However, where the distinction between the value of land and the value of the building, etc. is clear among the actual transaction price, where the standard market price under Article 99 of the Income Tax Act for land and buildings, etc. is all calculated in proportion to the value calculated according to the standard market price as of the date of the supply contract. According to Article 99 of the former Income Tax Act (amended by Act No. 11845, May 28, 2013), the standard market price of the land is the officially assessed individual land price, and the standard market price of the building is determined and publicly announced by the Commissioner of the National Tax Service at least once a year in consideration of the newly constructed price, structure, use, location, year of construction

According to the above provisions, the value-added tax base related to the transfer of the first real estate of this case is calculated as follows:

Scope of building standard market prices: 609,301,120 won

0

[Amount per square meter (563,00 won) = Standard amount of new construction price (610,000 won) x structural index (1.00) x place of use.

Number (1.10) ¡¿ Location index (1.05) ¡¿ Remaining rate by the number of years elapsed (0.8)

B. 342,580,000 won

0

Abstract Whether the calculation of tax base is illegal or not

In a lawsuit seeking revocation of a taxation disposition, the issue of whether the tax disposition is unlawful should be determined by whether the amount of the tax assessed exceeds the reasonable amount of tax assessed by the pertinent taxation disposition. Thus, even where the tax authority erred in the process of calculating and determining the tax base and amount of tax, and thus, even if the tax disposition is unlawful, if the tax amount imposed and collected does not exceed the reasonable amount of tax calculated, and the erroneous method does not vary in the scope of the taxable unit and the reason for the disposition, it does not constitute unlawful imposition and collection disposition within the reasonable amount of tax (see, e.g., Supreme Court Decision 2004Du3823, Jun.

According to the above legal principles, the Defendant deemed the transfer value of the real estate No. 1 in this case as KRW 1.39 billion, and calculated the value-added tax based on this standard. However, this does not exceed the reasonable transfer value of the real estate No. 1 in this case, so the Defendant’s calculation of the tax base is not unlawful. The Plaintiff’s assertion on this part cannot be accepted.

B) Regarding the assertion of input tax deduction

According to the statements in Gap evidence Nos. 11-3, 11-4, and 11-5, it is recognized that the plaintiff paid 660,000 won, including value-added tax, to the Han field law firm on November 14, 2012 as remuneration fees for acquiring the second real estate of this case, and received cash receipts. The plaintiff paid 11,00,000 won to both licensed real estate agents on November 23, 2012.

However, among the above amounts, 60,000 won is not subject to the input tax deduction for the real estate No. 1 of this case as costs related to the real estate No. 2 of this case, and 11,000,000 won is not subject to the input tax deduction for the real estate No. 1 of this case, since there is no evidence to acknowledge that a tax invoice for the above amount has been issued, it does not constitute the subject of the input tax deduction pursuant to Article 17(2)2 of the former Value-Added Tax Act (in the case of failure to submit a list of total tax invoices by individual)

In addition, the plaintiff argues to the effect that the input tax deduction should be granted even if the taxable period for the purchase and sale differs from each other with respect to the case of a large transaction amount, but this cannot be accepted merely because it is an independent argument without any basis.

C) As to the assertion that the imposition of penalty is improper

Under the tax law, penalty taxes are administrative sanctions imposed in accordance with the provisions of the tax law in cases where a taxpayer violates a tax return and tax liability without justifiable grounds in order to facilitate the exercise of the right to impose taxes and the realization of a tax claim, and the taxpayer’s intention and negligence is not considered. However, in cases where there is a circumstance where a taxpayer is reasonably allowed to present his/her tax or where it is unreasonable for the taxpayer to expect the fulfillment of his/her tax obligation to do so, and there is no justifiable reason to believe that it is unreasonable for the taxpayer to do so (see Supreme Court Decision 2011Du13842, Feb. 27, 2014).

With respect to this case, there is no evidence to deem that there is a justifiable reason for the Plaintiff’s failure to report and pay value-added tax. Therefore, this part of the Plaintiff’s assertion is without merit.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and it is so ordered as per Disposition.

partnership.