Whether a second tax liability is subject to a complaint;

Since a second taxpayer's designated disposition alone does not become final and conclusive, the designation disposition cannot be deemed an administrative disposition that is the object of an appeal litigation.

Article 52 (Disstatement of Calculation) of Corporate Tax Act

2013Guhap21602 Revocation of Disposition of Imposing corporate tax, etc.

A ma

b Head of the Tax Office

March 21, 2014

April 18, 2014

1. Of the instant lawsuits, the part of the claim for revocation of the designation of the secondary taxpayer as of November 12, 2012 and March 18, 2013 shall be dismissed.

2. The plaintiffs' remaining claims are dismissed.

3. The costs of lawsuit are assessed against the plaintiffs.

Cheong-gu Office

Each disposition listed in the separate disposition list issued by the defendant against the plaintiffs shall be revoked.

1. Details of the disposition;

A. On December 1, 2008, the Plaintiffs, as married couple, acquired 10,00 shares of AAF from Kimb (10,000 shares) and Kim C (9,00 shares) (20,00 shares) from all shareholders of AFF Co., Ltd. (hereinafter referred to as “AF”), each of whom 10,00 shares of AF (20,00 shares), and until September 27, 2010, each of which sold shares of AF from December 2, 2008 to another person of AF, Plaintiff Ba was registered as a director of AF and Plaintiff Kimt as a representative director of AAF.

B. On November 25, 2008, the head of the Gg Logistics Terminal Co., Ltd. (hereinafter referred to as the "g logistics terminal") revealed that the Gg Logistics Terminal Co., Ltd. (hereinafter referred to as the "Gg logistics terminal") transferred the g logistics terminal's 2,380 shares (amount per 10,000 won) of the Gg Logistics Terminal's g logistics terminal's 2,380 shares (amount per 10,000 won) owned by the g logistics terminal's g logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's eg logistics terminal's e.

C. On August 1, 2012, the Defendant notified the Plaintiffs to pay corporate tax of KRW 173,01,330 (208, corporate tax of KRW 171,521,490 + corporate tax of KRW 1,489,840 attributed to the business year of 2008 + corporate tax of KRW 1,489,840 attributed to the business year of 2009). However, on November 12, 2012, the Defendant designated the Plaintiffs as the secondary taxpayer on the ground that they are oligopolistic stockholders of AAAF, and notified the Plaintiffs that they should pay corporate tax of KRW 91,176,920 (= corporate tax of KRW 785,120 attributed to the business year of 208 + corporate tax of KRW 90,391,80 attributed to the business year of 209) (hereinafter “instant Disposition 1”).

D. Accordingly, on January 25, 2013, the plaintiffs filed an objection, the commissioner of kk Regional Tax Office revised the corporate tax by applying the unfair act and calculation rules to the difference between the gg logistics terminal's shares 2,380 per share that the gg logistics terminal transferred to Kimq to KRW 84,246,00,000, and the transfer price of KRW 5,000,000,000. Based on such determination, the second tax notice amount against the plaintiffs was corrected by applying the unfair act and calculation rules. The defendant around that time, pursuant to the above determination, the notified tax amount against the plaintiffs was 15,452,810 won (=67,690 won of corporate tax for the business year 2008 + corporate tax for the business year 785,1209 + the corporate tax for the business year 209,000 won (hereinafter "instant correction disposition"), and the defendant did not notify the plaintiffs of the amount to be paid to the plaintiffs on March 18, 206.

E. On May 15, 2013, the Plaintiffs appealed to the Tax Tribunal, but dismissed on November 29, 2013, the Plaintiffs filed the instant administrative litigation.

[Ground of recognition] Unsatisfy, Gap evidence 1 to 6, Eul evidence 1 to 7

the purpose of each entry, as a whole, of the entire pleadings, including branch numbers

2. On the lawfulness of the part concerning the claim for revocation of the designation of the secondary taxpayer as of November 12, 2012 and March 18, 2013 among the instant lawsuits, ex officio determination as to the lawfulness of the part concerning the claim for revocation of the designation of the secondary taxpayer as of March 18, 2013 among the instant lawsuits, we examine whether the part concerning the claim for revocation of the designation of the secondary taxpayer as of November 12, 2012 and March 18, 2013 are legitimate.

The secondary tax liability pursuant to Article 39 of the Framework Act on National Taxes is abstractly established by the occurrence of a fact that meets the requirements such as the main taxpayer’s default, and specific confirmation is made by a notice of payment. Since the secondary tax liability is not determined by itself, the designation disposition of the secondary taxpayer is not yet finalized, such designation disposition is not an administrative disposition that is subject to appeal litigation (see, e.g., Supreme Court Decision 95Nu6632, Sept. 15, 1995).

Therefore, the part of the plaintiffs' claim for the revocation of the second taxpayer designation disposition of November 12, 2012 (aF's corporate tax attributed to the business year 2008 and 2009) and the second taxpayer designation disposition of March 18, 2013 (aF's other income tax attributed to the business year 2009) is unlawful.

3. Determination on the merits

A. The plaintiffs' assertion

The disposition Nos. 1 and 2 of this case shall be revoked on the following grounds.

1) The transfer of this case is a transfer of the subject matter of this case to Kimb and Kimq, a lineal ascendant, at the time 5 days earlier, after having already agreed to transfer all of the shares of AAAF to the plaintiffs, and the transfer date of this case is a transfer of the subject matter of this case at low price. ① It infringes upon the interests of AAF and thus cannot be deemed as a conduct of AAF, and ② it is a lineal ascendant such as Kimb and Kimc already agreed to transfer all of the shares of AAF to the plaintiffs, and thus, Kimqq is not a specially related party to AAF, and thus, it is not subject to

2) Even if the transfer of this case is subject to the wrongful calculation, the amount disposed of as other outflow or other income from the transfer should be included in the calculation of losses, which constitutes double taxation, and thus constitutes a violation of the substance over form principle.

3) Even if a disposition imposing corporate tax on aaF based on the rejection of wrongful calculation is lawful, it is unreasonable to designate the Plaintiffs who did not participate in the transfer of this case as the secondary taxpayer and impose corporate tax, etc. aAF, which is delinquent, on November 25, 2008, the transfer date of this case.

(b) Related statutes;

The entry in the attached Form is as specified in the relevant statutes.

C. Determination

1) Article 52 of the former Corporate Tax Act provides that a corporation’s act of wrongful calculation under Article 52 of the former Corporate Tax Act is deemed to have avoided or reduced tax burden by abusing the various forms of transactions listed in each subparagraph of Article 88(1) of the former Enforcement Decree without a reasonable method by a person with a special relationship. It applies only to cases where the person with a right to taxation is deemed to have denied it and have income objectively and reasonably deemed reasonable by the method prescribed in the statutes. In light of the economic person’s perspective, determination of whether economic rationality exists shall be made based on whether the transaction is unfair in light of sound social norms and commercial practices (see, e.g., Supreme Court Decisions 2005Du14257, Dec. 13, 2007; 208Du152979, Oct. 28, 2010). Meanwhile, determination of whether the transaction constitutes a wrongful calculation under Article 88(1)9 of the former Corporate Tax Act as of the date of wrongful calculation is made.

In light of the above legal principles, the transfer of this case is deemed null and void solely on the ground that the transfer of this case is contrary to the intention of Kimb, Kim Cc, etc., which held most of the shares AAF (19,000 shares out of 20,000 shares) at the time of transfer, and that the transfer of this case is contrary to the interests of AAF, and the transfer of this case cannot be deemed null and void. ② The types of the act subject to rejection of wrongful calculation are contrary to the interests of the juristic person concerned. Since most of the types of the act subject to wrongful calculation are contrary to the interests of the juristic person concerned, it shall be deemed that the wrongful calculation can be denied regardless of its legal validity. ③ Whether there is a special relationship between AAF and EF, as of November 25, 2008, which is the date of the transfer contract of this case. ④ The transfer of this case was owned by 95% of the shares at the time of the transfer of this case, ④ The transfer of this case is substantially lower than the market price of the transfer of this case, 500 million won.

Since it is reasonable to see that the tax burden has been reduced unfairly, the plaintiffs' assertion that the transfer of this case is not subject to the avoidance of wrongful calculation is without merit.

2) The purport of the former Corporate Tax Act providing for the denial of wrongful calculation is to ensure fairness in taxation and to prevent tax avoidance by imposing tax by deeming that the person imposing tax was objectively reasonable in terms of tax law, when deeming that a transaction with a corporation and a related party has neglected economic rationality by using a certain type of transaction under the ice transaction (see, e.g., Supreme Court Decision 95Nu18697, May 28, 1997). Therefore, in the event of the avoidance of wrongful calculation due to a low-price transfer, it is deemed that there was a corresponding income by presenting a transaction at the market price recognized as reasonable in the event of a low-price transfer and then imposing corporate tax by deeming that there was a corresponding income. If the difference between the market price and low-price transfer is included in the loss of a corporation on the ground that the difference between the market price and low-price transfer is not effective, the purpose of the avoidance of wrongful calculation would not be achieved, and that the provision would not result in the omission. Considering this, it is justifiable to include the amount not disposed of as loss due to transfer or other income.

3) The time when the corporate tax liability comes into existence is when the taxable period ends (Article 21(1)1 of the Framework Act on National Taxes). As of the date when the national tax liability comes into existence, the person who owns more than 50/100 of the total number of issued stocks of the corporation and actually exercises the rights thereto shall be liable to pay the second tax on the amount insufficient to cover with the assets of the corporation among the corporate tax imposed on the corporation.

According to the above legal principles, the following circumstances can be comprehensively taken into account the facts acknowledged earlier and the overall purport of arguments as to the instant case: ① the date of establishing the corporate tax liability for the business year 2008; ② the date of establishing the corporate tax and other income tax for the business year 2009; ② the stocks of the Plaintiff were owned by the Plaintiffs each 50% before the date of establishing the national tax liability; ② the stocks of the Plaintiff were transferred to a third party before the date of establishing the national tax liability and the transfer of the title was completed on the list of shareholders, and the former oligopolistic shareholder did not constitute the oligopolistic shareholder with the secondary tax liability under the Framework Act on National Taxes (see, e.g., Supreme Court Decision 2000Du1850, Mar. 15, 2002; ② the Plaintiffs cannot be deemed to bear the tax liability for the oligopolistic shareholder’s transfer of the corporate tax under the provisions of the Framework Act on National Taxes, and ④ the Plaintiffs’ transfer of the stocks to the Plaintiffs under the provisions of Article 29 of the Framework Act on National Taxes.

shall not be deemed to exist.

4. Conclusion

Therefore, the part of the claim for revocation of the designation of the secondary taxpayer as of November 12, 2012 and March 18, 2013 among the lawsuit in this case is unlawful. Thus, each of the claims except the plaintiffs' rejection portion is dismissed, and it is dismissed as it is without merit. It is so decided as per Disposition.