Whether a secondary taxpayer is a secondary taxpayer or not

In the event that there are circumstances such as whether a tax authority is a real investor, such as the list of members, list of investors, etc., the tax authority should prove that the nominal owner is not a real investor, and the nominal owner is not a real investor.

Article 2 of the Value-Added Tax Act / [Taxpayer]

Article 3 of the Value-Added Tax Act [Taxable Period]

1.The plaintiff (Appointed Party)'s claims are all dismissed.

2. The costs of a lawsuit shall be borne by the plaintiff.

The defendant's notice of payment of value-added tax of KRW 16,738,420 on February 28, 2006 against the plaintiff (appointed party; hereinafter referred to as the "Plaintiff") and the appointed party's original ○○○ in 1999 and the notice of payment of value-added tax of KRW 5,579,470 on February 28, 200 shall be revoked.

1. Circumstances of dispositions;

A. ○○○ Logistics Co., Ltd. (hereinafter “○○○ Logistics”) awarded a successful bid of ○○○○○○○-dong, ○○-dong, ○○○-○ site and 466 square meters on land (hereinafter “instant real estate”) which is one’s own property, to Y○○○ through a court’s voluntary auction and transferred ownership to Y○○○ on April 28, 200, but did not report and pay the value-added tax on the transfer of the instant real estate subject to value-added tax.

B. On November 2, 2004, the Defendant calculated the auction price of the real estate of this case as 392,010,246 won, and calculated the price of the building of this case as 39,201,024 won, which is 10%, as principal tax. The Defendant added the additional tax of 7,840,204 won, the additional tax of 34,496,900 won, and the additional tax of 34,538,120 won (including the additional tax of 42,37,104 won) for the first period of 200 to ○○ Logistics, including the additional tax of 81,538,120 won (including the additional tax of 42,37,104 won). On November 1, 2004, the Defendant issued a tax notice to ○○○○○○○○’s address and sent it to service by publication, the Plaintiff, the designated parties, ○○○○○, and 14.

C. The plaintiff et al. dissatisfied with the above payment notice disposition and filed an appeal with the National Tax Tribunal on June 17, 2005.

The National Tax Tribunal closed the business of December 1, 2005 on July 31, 199 and registered the dissolution on August 30, 199. The real estate in this case was transferred at a voluntary auction thereafter shall be deemed to have been supplied to ○○ Logistics around July 1999 with remaining goods at the time of closure of ○○ Logistics; and if ○○ Logistics loses its status as a person liable to pay value-added tax and thereafter loses its status as a person liable to pay value-added tax, it shall be deemed that ○○ Logistics was supplied with goods for business.

Since it should not be viewed that the Defendant imposed value-added tax on ○○ Logistics pursuant to Article 6(1) of the Value-Added Tax Act and Article 14(1)4 of the Enforcement Decree of the Value-Added Tax Act, the Defendant determined that it is reasonable to revise the value-added tax base as KRW 246,770,208 and to designate and notify the secondary taxpayer under Article 49(1)1 of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 15973, Dec. 31, 1998) by applying Article 6(4) of the Value-Added Tax Act and Article 49(1)1 of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 15973, Dec. 31, 1998) to the acquisition value of the building pursuant to Article 379,646,475 won X (7) of the Value-Added Tax Act

On January 4, 2006, the Defendant revoked the first imposition disposition, and notified the 16,738,420 won, respectively, to ○○○○○○ (hereinafter referred to as the “instant disposition”). On February 28, 2006, the Defendant issued a notice to 5,79,470 won, respectively, to 16,738,420 won and 5,579,470 won to ○○○○ (hereinafter referred to as the “instant disposition”).

[Based on Recognition] Evidence A 1-5, Evidence A 3-5, Evidence A 5-2, Evidence 1-3, Evidence A 6-1-2, Evidence A 7-1-2, Evidence A 8-9, Evidence A 1-2, Evidence B-2, Evidence B-4, Evidence B-1-4, Evidence B-1-1-4, Evidence Nos. 8-1-4, and the purport of the whole pleadings

2. Whether a disposition is lawful

(a)the plaintiff's assertion;

(1) The Selected ○○○ and Lee Dong-○ are only registered on the list of members with the Plaintiff’s wife and his father and wife, and did not make any contribution at all, and the Plaintiff did not receive a dividend of the profit from the investment at a short time from the ○○ Logistics. Meanwhile, after the incorporation of the company with the Plaintiff’s mixed investment, the Plaintiff defaulted on January 9, 1998 due to the international remedy financial situation, and transferred the representative director’s position to Lee○○○○ and the entire company’s business rights to the Plaintiff. Accordingly, the Plaintiff and the designated parties are merely formal employees and do not actually belong to the secondary taxpayers, and they do not constitute the secondary taxpayers.

(2) 원고와 선정자들은 임의경매로 인한 경락이 부가가치세 과세대상 및 신고대상인지 몰랐고, 더구나 이 사건 부동산은 ○○물류의 소유이고 ○○물류의 대표자가 회사를 인수한 후 방만하게 회사를 운영하다가 도산했으며, 이 사건 부동산은 국제구제금융사태로 가격이 현저하게 내린데다, 경매 당시 그 경매사실을 ○○물류의 대표자에게 통지했다고는 하나 당시 ○○물류의 대표자가 사업실패로 행방불명되었고, 원고들은 과점주주에 해당하기는 해도 회사의 경영일선에서 물러나 있었기 때문에 경매 진행사실을 모르고 있었으며, 피고가 경매시 배당요구를 했다면 제1순위로 배당받을 수 있었는데도 그 의무를 다하지 않고 징수기회를 놏친 상태에서 본세보다 많은 가산세를 부과하고, 경락일로부터 4년 10개월이 지난 2005.3.15.에서야 원고들을 ○○물류의 제2차 납세의무자로 지정하여 ○○물류의 부가가치세를 납부고지한 것은 위법하다.

(b) relevant statutes;

Attached Form 2 is as shown in the attached Table 2.

(c) Fact of recognition;

(1) The ○○ Logistics reported the closure of its business on July 31, 1999, and registered the dissolution on August 30, 1999 by a resolution of its general meeting of partners on August 23, 1999.

(2) On the list of members of ○○ Logistics, the Plaintiff, the Appointors, and the ○○○○, each share of 30 per cent; the Appointors, the 10 per cent share of the Plaintiff’s children; the ○○○, the ○○○, and the 16 per cent share of the 14 per cent.

(3) According to the balance sheet of the 1998 business year of ○○ Logistics, land among the instant real estate is located.

It is included in 482,00,000 won and 379,646,475 won in total.

[Based on recognition] Evidence A 5-2, Evidence A 8-2, and the purport of the whole pleadings

D. Determination

(1) Whether the plaintiff et al. constitutes a secondary taxpayer

(A) The Plaintiff asserts that ○○○○ and ○○○○○ is not a substantial investor of ○○ Logistics. However, the tax authority should prove whether an investor is an investor by means of a register of members, a list of investors, etc., and in the event that there are circumstances, such as that the designated parties have stolen the name, or that the name was registered in a name other than the name of the actual owner, the nominal owner should prove that the nominal owner is not a substantial investment. As seen above, even though the designated parties are entered in the register of members, they do not prove that they are not the substantial investors, and thus, the Plaintiff

(B) The Plaintiff asserts that the representative director transferred his/her business title to ○○○ and transferred his/her entire business title to ○○○○, and thus, is not a de facto employee. However, there is no evidence to prove that the Plaintiff transferred his/her equity interest to ○○○. Therefore, the Plaintiff’

C) Ultimately, the Plaintiff and the designated parties are oligopolistic shareholders of ○ Logistics, who are the secondary taxpayers.

(2) Whether the imposition of value-added tax is legitimate

(A) Under the Framework Act on National Taxes, if a taxpayer fails to file a tax base return within the statutory due date of return, the period of exclusion from the imposition of national taxes may be seven years from the date on which the national taxes can be imposed. In accordance with Articles 3(3) and 6(4) of the Value-Added Tax Act as of July 31, 199, when ○○ Logistics closed, and Articles 3(3) and 6(4) of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 15563, Dec. 31, 1997) and Article 21(1)7 of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 16661, Dec. 31, 199) on the real estate of this case, the real estate of this case shall be deemed to have been supplied voluntarily on July 31

The tax authority may impose value-added tax on the 25th day after July 31, 1999, which is the date of establishment of value-added tax. Since the tax authority may impose value-added tax for seven years thereafter, it is legitimate to impose value-added tax on ○○ Logistics on November 2, 2004, which is within the scope of value-added tax.

(B) The Plaintiff and the designated parties argued that they had different knowledge of whether the successful bid caused by the voluntary auction is subject to value-added tax and subject to reporting. However, Article 2 of the Value-Added Tax Act provides that the person liable for the payment of value-added tax is ○○ Logistics, which is a business operator, and thus, the Plaintiffs, which are only the secondary taxpayers, do not necessarily have to know of whether the successful bid caused by the voluntary auction is subject to value-added tax and subject to reporting. Meanwhile, unlike the first disposition, the grounds for imposing value-added tax on the supply of the real estate of this case by the decision of the National Tax Tribunal, unlike the first disposition, is not the supply of the goods through the auction stipulated in Article 6(1) of the Value-Added Tax Act and Article 14 of the Enforcement Decree of the Value-Added Tax Act, and thus, the supply of the goods stipulated in Article 6(4)

(C) In order to facilitate the exercise of the right to taxation and the realization of a tax claim, additional tax under tax law is an administrative sanction imposed as prescribed by individual tax law in cases where a taxpayer violates various obligations, such as a return and tax payment, without any justifiable reason, and the taxpayer’s intent or negligence is not considered, while it is not possible to impose additional tax in cases where there are justifiable grounds that make it impossible to cause a taxpayer’s failure to perform his/her duties. As seen above, the return of value-added tax and ○ Logistics, who is the taxpayer, should report and pay value-added tax on the ground that the remaining goods are supplied by himself/herself at the time of the page, and the return and payment of value-added tax should be made on the ground that the remaining goods are sold at a voluntary auction, and the fact that the remaining goods acquired ownership by a third party does not constitute a case where there is a justifiable reason that does not cause a failure to cause any negligence due to the Plaintiff’s failure to report the obligation to pay value-added tax and the neglect of the obligation to pay the instant real estate among the real estate in this case.

(D) The Plaintiff asserted that the Defendant could not receive a dividend in the first priority order, even if he did not demand an auction. However, since value-added tax is not a tax imposed by the tax authority, but a tax should be reported and paid by the business entity. Therefore, it is difficult for the tax authority to understand the fact of discontinuance of ○○ Logistics, unless the Defendant reported and paid the closure of ○○ Logistics. Even if the Defendant was aware of the closure of ○○ Logistics, it is difficult for the instant tax authority to find out the fact of discontinuance of ○○ Logistics. As long as it was long after the closure of ○○ Logistics, value-added tax was imposed on the instant real estate by auction, or demand a distribution to the court of execution, and it is difficult to receive a dividend as a matter of course in the voluntary auction of real estate, unless there is any evidence to prove that the value-added tax on the building could not be distributed in the first priority order, and

5. Conclusion

Thus, the defendant's disposition of this case is legitimate, and all of the plaintiff's claim seeking revocation is rejected as it is without merit.

1. List of Selections:

1. ○○ (○○○○○-○○○○○)

○○-dong 3 ○-○

2. ○○○ (○○○○-○○○○○)

Ilsan-si ○○○ 147 ○ apartment ○ ○○ ○○-dong ○○

3. ○○ (○○○○-○○○○○)

○○○ Dong 147 ○ apartment ○○ Dong ○○ Dong, ○○○.

2. Related Acts and subordinate statutes

Article 26-2 of the Framework Act on National Taxes (1) A national tax may not be levied after the expiration of the period provided in the following subparagraphs: Provided, That where mutual agreement procedures are in progress under the provisions of a treaty concluded to prevent double taxation (hereinafter referred to as "tax treaty"), Article 25 of the Adjustment of International Taxes Act shall apply:

1. (Omission)

2. If the taxpayer fails to file a written tax base return within the legal return term, for seven years from the day on which the national tax is assessable;

○ A person who independently supplies goods (referring to goods as provided in Article 1; hereinafter the same shall apply) or services (referring to services as provided in Article 1; hereinafter the same shall apply) on a business basis, regardless of whether or not there is profit-making purpose under Article 2 (1) of the Value-Added Tax Act (hereinafter referred to as an “business person”) shall be liable

(2) The persons liable for tax payment under paragraph (1) shall include individuals, corporations (including the State, local governments, and local government associations), unincorporated associations, foundations, and other organizations.

○ Tax period Article 3 of the Value-Added Tax Act

(1) The taxable period of value-added taxes for entrepreneurs shall be as follows:

First period: from January 1 to June 30; and

2. Second period: from July 1 to December 31.

(Omission)

(3) The taxable period in cases where a business operator closes his/her business shall be from the first day of the taxable period in which the date of closedown falls to the date of closedown: Provided, That where he/she ceases to commence his/her business after registration pursuant to the proviso to Article 5 (1), it shall be

(1) The supply of goods under Article 6 of the Value-Added Tax Act refers to the delivery or transfer of goods on all contractual or legal grounds.

(2) Where an entrepreneur directly uses or consumes goods produced or acquired in connection with his/her own business, those prescribed by Presidential Decree shall be deemed the supply of goods.

(3) Where an entrepreneur uses or consumes goods which are produced or acquired in connection with his/her own business for personal purposes or for other purposes, or donates them to his/her customers or many unspecified persons, those goods prescribed by Presidential Decree shall be deemed the supply of goods.

(4) The remaining goods when an entrepreneur discontinues his business shall be deemed to be supplied to him. The same shall also apply to the case where a registration is made under the proviso of Article 5 (1) and the actual business does not commence.

(5) In selling and buying goods on consignment or through an agent, the consignor or the principal shall be deemed to have supplied or received goods directly: Provided, That the same shall not apply if the consignor or the principal is not identified.

(6) Any of the following subparagraphs shall not be deemed the supply of goods:

1. Offering any goods as security, which are prescribed by the Presidential Decree; and

2. Transfer of business as prescribed by the Presidential Decree: Provided, That this shall not apply to a case where an entrepreneur delivers a tax invoice under Article 16, as prescribed by the Presidential Decree;

3. Paying taxes in kind under Acts, as prescribed by the Presidential Decree.

(7) Matters necessary for the supply of goods under paragraph (1) shall be prescribed by Presidential Decree.

(1) The time of supply for goods under Article 9 (1) of the former Enforcement Decree of the Value-Added Tax Act shall be as follows: Provided, That if the time of supply for goods supplied prior to the closure of business arrives after the date of such cessation of business, the time of supply shall be deemed the time of supply

1.-6. (Omission)

7. In case of Article 6 (4) of the Act, when the business is closed;

(1) In case where the goods used for a taxable business fall under the depreciable assets as referred to in Article 62 of the Enforcement Decree of the Income Tax Act or Article 24 of the Enforcement Decree of the Corporate Tax Act (hereinafter referred to as the " depreciable assets"), the amount calculated by the following formula shall be considered as the market price of the goods concerned. In this case, the number of the taxable periods in progress shall be calculated by the taxable period as referred to in Article 3 of the Act, but if the number of the taxable periods in which the buildings or structures elapsed exceeds 20, the amount shall be considered as 20, and if the number of the taxable periods in which the buildings or structures elapsed exceeds 4, the amount shall be considered as 4:

1. Buildings or structures:

Acquisition price X (1-5/100 of the taxable period that elapsed) or market price of the goods concerned =

2. Other depreciable assets:

The acquisition price X (1-25/100 of the taxable period that elapsed) or market price of the goods concerned =

○ Article 22 of the Value-Added Tax Act

(1) From sunrise to D. (Omission)

(5) Where an entrepreneur falls under any of the following subparagraphs, the amount prescribed in the relevant subparagraphs shall be added to the payable tax or deducted from the refundable tax amount:

1. The amount equivalent to 10/100 of the payable amount not declared (the relevant insufficient amount if declared short) and of the refundable amount declared in excess of the refundable amount in case where the declared tax amount fails to be declared in accordance with Article 18 (1) and (2) (proviso) or 19 (1) or the declared tax amount falls short of the payable amount to be declared, or the refundable amount to be declared exceeds the refundable

2. The amount calculated by applying the interest rate as prescribed by the Presidential Decree considering the following matters to the unpaid tax amount (if short of the tax amount, the deficient tax amount) in case that the tax amount is not paid as provided in Article 18 (4) or 19 (2) or the paid tax amount is short of

(a) The interest rate applied by financial institutions to overdue loans;

(b) The period from the day after the payment deadline to the date of voluntary payment or payment notice.