The identity of the actual representative of the income disposal subject;

The representative, who is a person subject to disposal of income, refers to the actual representative of the corporation, and the representative on the registry is presumed to be the actual representative, so the person who asserts that the representative on the registry did not operate the company should prove that he did not operate the company

Article 67 (Disposal of Income)

Article 106 (Disposition of Income)

1. The plaintiff's claim is dismissed.

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

The Defendant’s imposition of global income tax of KRW 123,468,930 on July 5, 2006 against the Plaintiff and KRW 77,957,050 on global income tax of the year 2004 shall be revoked.

1. Details of the disposition;

A. ○○ Construction Co., Ltd. (hereinafter “○○ Construction”) is a company established for the purpose of transporting cargo on January 12, 1968. The Plaintiff was registered as a representative director on the corporate register of ○ Construction Co., Ltd. from January 31, 2003 to October 16, 2005.

B. ○○○ branch received a false tax invoice in the business year 2003, including 291,691,400 won in total, and 207,457,800 won in total, from data such as ○○ Trade Co., Ltd. without real transaction, and included it in deductible expenses in filing a return on the corporate tax base and tax amount in the business year 2003 and 2004.

C. The head of the ○○ Tax Office issued a decision to revise corporate tax by adding the supply value for the business year of 2003 and 2004 to the ○○○○○○○, while considering that the above supply value was leaked to a private place and thus its ownership is unclear, the head of the ○○ Tax Office also issued a notice of change in the income amount for the business year of 2003 to the Plaintiff on January 2006, as well as a notice of change in the tax data to the Defendant, who is the head of the tax office having jurisdiction over the Plaintiff’s domicile, pursuant to Article 67 of the Corporate Tax Act and Article 106(1)1 of the former Enforcement Decree of the Corporate Tax Act (amended by Presidential Decree No. 18706, Feb. 19, 2005; hereinafter “former Enforcement Decree”).

D. Accordingly, on July 5, 2006, the Defendant respectively corrected and notified the Plaintiff of KRW 123,468,930 as global income tax for the year 2003 and KRW 77,957,050 as global income tax for the year 2004 (hereinafter “instant disposition”).

E. The plaintiff raised an objection against the defendant on July 31, 2006, but the defendant dismissed the above objection on August 18, 2006, and the plaintiff filed a request for adjudgment with the Director of the National Tax Tribunal on October 19, 2006, but the Director of the National Tax Tribunal dismissed the above request for adjudgment on January 18, 2007.

(In fact that there is no dispute, Gap evidence 1 to 3, Gap evidence 2, Eul evidence 6 to 9, the purport of the whole pleadings.

2. Whether the instant disposition is lawful

A. The parties' assertion

As to the defendant's assertion that the disposition of this case was lawful on the grounds of the above disposition and the relevant Acts and subordinate statutes, the plaintiff asserted that the actual representative director of ○○ Construction is ○○, and the plaintiff was merely a representative director in the name of ○ Construction, and that the disposition of this case, which the plaintiff is not the actual representative of ○ Construction, was unlawful on the ground that the disposition of this case,

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

(1) Article 106 (1) 1 (proviso) of the former Enforcement Decree of the Act provides that the upper limit on the disposal of income to the representative shall not be based on the fact that such income has accrued to the representative, but shall be deemed as a bonus to a de facto representative without regard to a certain fact that can be recognized as such act in order to prevent an unfair act under tax law by a corporation (see, e.g., Supreme Court Decision 92Nu3120, Jul. 14, 1992). Where a corporation fails to enter the sales in its books or appropriates the cost of processing in its books, the corporate income equivalent to the omitted sales or processing cost shall be deemed to have been leaked to the company. In this case, there is a need to prove that the omission of sales was not leaked from the company (see, e.g., Supreme Court Decision 200Du3726, Jan. 11, 202). Thus, the representative director who actually asserted that the processed amount should be the representative of the corporation under the proviso to Article 17 (16) of the former Corporate Tax Act.

(2) As asserted by the Plaintiff in this case, the Plaintiff was not the de facto representative of ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○ was the Plaintiff’s burden of proving that the Plaintiff was the de facto ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○ was the Plaintiff’s evidence, but the Plaintiff submitted evidence Nos. 3-1, 4 through 6, 100 to the Plaintiff’s ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○’s shares, which was difficult to be considered as evidence to establish the authenticity of the Plaintiff’s shares.

(3) Therefore, the Plaintiff is deemed to be the representative, who is a person subject to the recognition and contribution disposition under Article 106 of the former Enforcement Decree of the Act, and thus the disposition of this case, which was taken in whole,

3. Conclusion

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

Related Acts and subordinate statutes

Corporate Tax Act

Article 67 (Disposition of Income)

In filing a report on the corporate tax base on the income for each business year under the provisions of Article 60 or in determining or revising the corporate tax base under the provisions of Article 66 or 69, the amount included in the calculation of earnings shall be disposed of as bonus, dividend, other outflow from the company, internal reserve, etc. according to the person to whom it reverts

Enforcement Decree of the former Corporate Tax Act (amended by Presidential Decree No. 18706 of Dec. 9, 2005)

Article 106 (Disposition of Income)

(1) The amount included in the calculation of earnings under the provisions of Article 67 of the Act shall be disposed of under the provisions of the following subparagraphs. The same shall apply to non-profit domestic corporations

1. Where the amount included in the calculation of earnings has clearly leaked out of the company, the dividends, bonuses from the disposition of profits, other income, and other outflow from the company under each of the following items according to the person to whom they accrue: Provided, That where the accrual is unclear, it shall be deemed to have been reverted to the representative (where the total number of stocks held by an officer who is not a minority shareholder under the provisions of Article 87 (2) and persons with a special relationship under the provisions of paragraph (4) of the same Article is 30% or more of the total number of stocks issued or total investment amount of the relevant corporation and the officer actually controls the operation of the corporation, he shall be deemed the representative, and where a corporation which has been exempted from withholding taxes under the provisions of Article 46 (12) of the Restriction of Special Taxation Act reports that there is a separate representative among the officers who are stockholders, the reported person shall be the representative, and where there

(a) Where the person of accrual is a stockholder (not including stockholders who are officers or employees), the dividends of the person of accrual;

(b) If the person to whom it belongs is an officer or employee, the bonus to that person;

(c) Where the person to whom the income accrues is a corporation or an individual operating the business, other outflow from the company: Provided, That it shall be limited to cases where the distributed profit constitutes the income of a domestic corporation or a domestic business place of a foreign corporation under Article 94 of the Act for each business year, or the business income of a resident or a nonresident

(d) If the person to whom it belongs is a person other than that referred to in items (a) through (c), other income for the person to whom it reverts