Whether the tax invoice received from data can be deemed necessary expenses

As long as it is proved that the purchase tax invoice has been prepared falsely without real transactions, it is reasonable to view that the remaining purchase cost has been proved to the extent that it is reasonable to have been false.

Article 27 (Calculation of Necessary Expenses)

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

1. The plaintiff's appeal is dismissed.

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

The judgment of the first instance shall be revoked. The defendant's corrective disposition of KRW 147,898,590 against the plaintiff on August 5, 2005 shall be revoked.

1. 이 법원이 실시할 이유는 제1심 판결 중 제4면 제13행의 ‵을 3,4,6,7호증′을 ‵을제3,4,6,7,8호증′으로 고치고, 제5면 제1행의 ‵가공거래사실을 인정한 사실′, 다음에 ‵원고 또한 ○○세무서장으로부터 소외 업체와의 사이에 발생한 과세자료에 대한 소명요구를 받고 소외 업체로부터 수취한 세금계산서가 허위라는 사실을 자인하는 취지의 답변을 한 사실′을 추가하는 외에는 그 이유란 기재와 같으므로 행정소송법 제8조, 민사소송법 제420조에 의하여 이를 그대로 인용한다.

2. Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and the judgment of the court of first instance is just, and the plaintiff's appeal is dismissed as it is without merit, and it is so decided as per Disposition.

Incheon District Court 2006Guu1788 (Law No. 31, 2007)

1. Details of the disposition;

A. The Plaintiff, who operated pipes and electrical construction, declared the tax base and amount of value-added tax for the first and second five years 200 and the second years 200 and global income tax for the tax years 200 (title representative shall be Kim○) and purchased 7,727,270,000 and the total value-added tax for the third year 200 and 77,270,000 and the total value-added tax for the 205th five years 200 and 116,246,830 and the total value-added tax for each business income for the second five years 200 and 200 and the total value-added tax for the 205th five years 1,624,680 and the total value-added tax for each business income for the second five years 200 or less, and the Defendant purchased 16,246,830 won and the total value-added tax for the Plaintiff as necessary expenses or necessary expenses.

(Reasons for Recognition: comply with the purport of the whole pleadings and records, written evidence Nos. 1 and 2, evidence No. 7, evidence Nos. 1 and 8, evidence Nos. 1 and 2, evidence No. 5-1 and 2, and evidence Nos. 5.

2. Whether the instant disposition is lawful

A. The parties' assertion

The Defendant asserts that the disposition of this case is lawful on the grounds of the above disposition and related statutes, and the Plaintiff (1) received electrical construction from ○○ Construction and 4 companies during the 2000-year taxable period and received construction sales equivalent to KRW 1,132,037,582 from ○○ Construction and 4 companies. To do so, various expenses, including raw materials, have to be incurred, and such expenses should be deducted as necessary expenses for the business income. However, the disposition of this case was unlawful on the ground that the Nonparty company filed a complaint with the investigative agency as a material intermediary, and the entire purchase amount of this case should be excluded from necessary expenses.

"(2) The transaction between the plaintiff and the non-party company is true that the plaintiff performed the electrical construction work at the expense even if the purchase was made, so the plaintiff should deduct the expense and calculate the business income. Since the plaintiff lost all relevant evidence while closing its business on May 31, 2003, it constitutes a ground for determining the estimated investigation, as it constitutes "where there is no necessary account books and documentary evidence in calculating the tax base."

(1) Whether the processing purchase was made

(A) The Plaintiff: (a) on April 26, 200, the Plaintiff reported to Nonparty companies the price of electric materials to KRW 21,140,00; (b) on May 30, 200, KRW 28,660,00; and (c) on June 25, 200, KRW 27,470,00; (d) KRW 5,946,830 on October 15, 200; and (e) KRW 5,80,00 on October 31, 200; and (e) on the basis that it is difficult for the tax authority to prove that it is necessary for the taxpayer to bear the burden of proof in principle, on the grounds that it is difficult for the other party to bear the burden of proof that it is necessary for the taxpayer to bear the burden of proof to the extent that it is difficult for the other party to bear the burden of proof to the extent that it is not necessary for the taxpayer to bear the burden of proof.

(B) According to the evidence evidence Nos. 3, 4, 6, and 7, the Commissioner of the National Tax Service: (a) issued three copies of the processing tax invoice of KRW 77,270,00 in total supply value to the Plaintiff during the 1st taxable period of value-added tax in 2000 without supplying goods or services; (b) issued 170 copies of the processing tax invoice of KRW 2,163,403,40 in total to 44 companies from April 1, 200 to December 31, 201; (c) received 3,613,146,000 won in total from 11 companies to file a tax invoice and filed a tax invoice for sale and purchase; and (d) notified the Defendant of the fact that the ○○○○○○○○○○ Office was exempted from the issuance of the processed tax invoice of KRW 3,00 in total to 3,613,146,000 in total; and (e) notified the Defendant of the ○○○○○.

(C) According to the above facts, so long as it is proved that the operator of the non-party company filed an accusation against the non-party company as a material intermediary, and furthermore, the tax invoice of KRW 77,270,000 out of KRW 193,516,830, which was reported as the necessary expenses by the plaintiff, was prepared in falsity without real transaction, the remaining purchase cost is proved to be reasonable, and the remaining purchase cost is also proved to be false through the processing transaction. As such, the plaintiff needs to prove that it is easy for the plaintiff to present all materials, such as the account book and documentary evidence, as to the fact that the purchase cost has been actually paid. Accordingly, it is insufficient to find that the plaintiff paid the non-party company the purchase price of the electric materials equivalent to the purchase price of this case only on the basis of the evidence Nos. 3-1, 4, and 5, and evidence No. 6, and there is no other evidence to find otherwise, the defendant's disposition of this case on the premise that the purchase price of this case is false.

(2) Whether it constitutes grounds for determination of estimated investigation

(A) The tax base and tax amount of global income tax shall, in principle, be determined by the actual amount revealed by the method of a field investigation, and it shall be exceptionally permitted only when there is no taxpayer’s account books or documentary evidence in order to determine it by the method of a field investigation, or when there is no other way to disclose the actual amount of income without credibility because the tax authorities do not have any incomplete or false description. Thus, even if some of the account books or documentary evidence kept and recorded by the taxpayer is included in the books or documentary evidence, if it is obvious that the remainder except the part is consistent with all the facts and it can be calculated based on this, the tax base and tax amount shall not be determined by the method of a field investigation (see Supreme Court Decision 95Nu6809, Jan. 26, 196). Further, it shall not be deemed that the taxation disposition by the field investigation is more unfavorable than the method of a field investigation, or that the taxpayer voluntarily wants to investigate and determine it by the method of estimation.

(B) The Plaintiff filed a global income tax return for 200 years with a tax agent (outside adjustment), and constitutes a case where the tax base can be calculated based on the books kept and recorded as a person subject to double-entry bookkeeping. The instant disposition is based on the tax return and taxation data submitted by the Plaintiff, which is based on the results of calculating the tax base based on the remainder of the tax return and taxation data except for the processed transaction data (each entry and the overall purport of pleadings). It cannot be deemed a subject of determination by the method of additional investigation. The mere fact that the processing tax invoice was received or the relevant evidence was lost at the time of closure does not constitute an obvious objective reason that the amount of income cannot be calculated based on the books kept, etc., and there is no other evidence to acknowledge the additional investigation, and this part of the Plaintiff’s assertion is without merit.

3. Conclusion

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

Relevant statutes

◆ 구 소득세법(2006. 12. 30. 법률 제 8144호로 개정되기 전의 것)

Article 27 (Calculation of Necessary Expenses)

(1) In calculating real estate rental income, business income, temporary property income, other income, or forestry income, the necessary expenses to be included shall be the sum of the expenses corresponding to the total amount of income in the year concerned, which are generally accepted (amended by Act No. 511, Dec. 29, 1995; Act No. 5580,

(2) With respect to the expenses corresponding to the total amount of incomes before the relevant year, limited to those not appropriated as the necessary expenses prior to the relevant year, shall be deemed the necessary expenses.

(3) Matters necessary for calculation of necessary expenses shall be prescribed by Presidential Decree.

Article 80 (Settlement and Correction)

(1) If a person liable to make a final return on the tax base pursuant to Articles 70 through 72 or 74 fails to make such return, the chief of the district tax office or the director of the regional tax office having jurisdiction over the place of tax payment shall determine the

(2) If a person who has made a final return on the tax base under Articles 70 through 72 or 74, falls under any of the following subparagraphs, the superintendent of the district tax office or the director of the regional tax office having jurisdiction over the place of tax payment, shall correct the tax base and tax amount of the year concerned:

1. Where an omission or error exists in the contents of return;

2. Where the whole or part of the invoice for each sale and purchaser under the provisions of Article 163 or the payment record under the provisions of Articles 164 and 164-2 is not submitted;

3. Where the business operator designated as one to become a credit card merchant or a person to become a Cash Receipt merchant under Article 162-2 of this Act and Article 32-2 of the Value-Added Tax Act fails to become a credit card merchant or a Cash Receipt merchant without any justifiable reason, and the details of the

(3) Where the head of a regional tax office or the head of a regional tax office having jurisdiction over the place of tax payment determines or revises the tax base and amount of tax in the current year under paragraphs (1) and (2), he shall make it based on the books and other documentary evidence: Provided, That if it is impossible to calculate the amount of income by books and other documentary evidence for

(4) If any omission or error is found after the tax base and tax amount are determined or corrected, the director of the regional tax office having jurisdiction over the place of tax payment or the director of the regional tax office shall correct

◆ 구 소득세법시행령(2001. 12. 31. 대통령령 제17456호로 개정되기 전의 것)

Article 55 (Calculation of Necessary Expenses for Real Estate Rental Income, etc.)

(1) Necessary expenses corresponding to the total amount of income from real estate rental and business income for each year shall be as follows:

1. Purchase price (excluding a purchase reduction or a purchase discount) of the raw materials for the commodities or products sold and the incidental expenses thereto, and in this case, the original purchase price and incidental expenses thereto shall be applicable, if the relevant business operator has consumed such ones for a business use, as have been purchased for other purposes;

◆ 소득세법시행령

Article 143 (Determination and Revision through Estimation)

(1) The term "reasons prescribed by Presidential Decree" in the proviso to Article 80 (3) of the Act means the cases falling under any of the following subparagraphs:

1. Where necessary account books and documentary evidence are missing or important parts are incomplete or false in the calculation of the tax base;

2. Where the contents of the entry are obviously false in light of the market price, various charges, etc. of facilities, number of employees, raw materials, commodities, or products.

3. Where the contents of the captain are obviously false in light of the quantity of raw materials used, the quantity of power used and other operational circumstances.