Early High Court Decision 2015west 608 (O3. 19)

The actual operator of the business of this case is changedB, and the plaintiff only lent his name, and the disposition of this case is unlawful in violation of the principle of substantial taxation.

It is difficult to deem that the subject of attribution of the instant business and the business income therefrom is the Plaintiff, in light of the fact that the Plaintiff was active in the activities as a scood ice lecturer and the local and overseas business trips on a multiple-day basis, and that the statements of the witness BB are consistent.

Article 14 of the Framework Act on National Taxes

2015Guhap6378 Disposition of revocation of imposition of global income tax, etc.

SAA

Head of Mapo Tax Office

March 30, 2016

May 20, 2016

1. The imposition of global income tax of KRW 454,792,660 (including additional tax) imposed on the Plaintiff on November 1, 2014 shall be revoked.

2. The costs of the lawsuit are assessed against the defendant.

Cheong-gu Office

The phrase "454,794,660 won as stated in the application for amendment of the purport and cause of the claim is deemed to be a clerical error."

c)in person;

1. Details of the disposition;

A. On January 10, 2011, the Plaintiff completed the business registration with the trade name as “BB,” the opening date as “1.10.1.1.0,” the location of the business as “○○○○-dong, Seoul, ○○○○-Phoho, a domicile, and the type of business as “ retail business/electronic commerce business” (hereinafter “instant business”). On September 30, 201, the Plaintiff closed its business.

B. On May 31, 2012, the Plaintiff reported and paid the global income tax for the year 2011 on the basis that: (a) the amount of income from the instant business was appropriated as KRW 2,988,083,229; and (b) the necessary expenses was calculated as KRW 2,962,434,753; and (c) the amount of business income from the business of self-supporting artists, etc. was calculated as KRW 25,648,476; and (b) the amount of business income from the business

C. The Defendant requested the Plaintiff to submit relevant books and data regarding KRW 2,820,049,00, which was not submitted with the receipts of qualified evidence among the necessary expenses for the instant business reported as simple books, but the Plaintiff did not submit them.

D. The Defendant estimated the business income pertaining to the instant business and estimated the business income to the Plaintiff on November 1, 2014.

The Defendant corrected the amount of KRW 36,540,920 out of the amount of the global income tax (including the additional tax) for the year 2011, on the ground that the error in the calculation of the amount of the additional tax was corrected on January 6, 2015 (hereinafter referred to as the “disposition of this case”) and corrected the amount of KRW 454,792,660 of the amount of the said tax (including the additional tax) for the purpose of correcting the error in the calculation of the amount of the additional tax).

E. Meanwhile, although the Plaintiff filed a request for inquiry on December 17, 2014, the Tax Tribunal rendered a decision to dismiss the Plaintiff’s request for inquiry on March 19, 2015.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1, 2, 4, Eul evidence Nos. 1, 2, 9, 10 (including the relevant number), the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. Relevant legal principles

Article 14 (1) of the Framework Act on National Taxes provides that "if the ownership of income, profit, property, act or transaction subject to taxation is nominal and there is a separate person to whom such income, profit, act or transaction belongs, the person to whom such income, etc. belongs shall be the person to whom such income, etc.

If there is a person who substantially controls and manages the taxable subject to income, profit, property, act, transaction, etc. different from the nominal owner, the nominal owner for the reason of form and appearance shall not be the person who actually controls and manages the taxable subject to taxation pursuant to such substance over form principle, instead of the nominal owner as the person liable for duty payment. In addition, whether such a case is applicable should be determined by comprehensively taking into account various circumstances such as the details of the use of name, content of the agreement between the parties concerned, the degree and scope of the nominal owner’s involvement, internal responsibility and calculation relationship, and the location

Meanwhile, in principle, the tax authority bears the burden of proving the existence and the tax base of the facts requiring taxation. This also applies to cases where the tax authority contests that the nominal owner of the transaction, etc. and the actual owner of the transaction, etc. are different, barring special circumstances, such as a separate legal provision converting the burden of proof. However, as long as the tax authority imposed tax by deeming the nominal owner as the actual business owner, it is necessary for the business owner to assert and prove that the nominal owner of the transaction, etc. is different from the nominal owner of the transaction, etc. so long as the tax was imposed. In such a case, the need for proof is sufficient to the extent that the judge has a reasonable doubt as to the fulfillment of the tax requirements. As a result, it is unclear whether the actual owner of the transaction, etc. belongs to the nominal owner, and if it becomes impossible to obtain conviction of the judge, then the disadvantage therefrom remains back to the tax authority that bears the ultimate burden of proof (see Supreme Court Decision 2011Du93

(b) Fact of recognition;

1) From October 1, 2010 to October 1, 2010, the Plaintiff operated ○○○○○-dong, Seoul, ○○○○○○-dong, an scoober equipment, structural equipment, and retail chain located in the 1st underground floor from this △△△△△△△△△△△, and was working as a scoo scoo ice lecturer from November 201 to April 30, 201 as the above company affiliated with the above company. The Plaintiff was provided with theoretical lectures, swimming pool lessons, domestic and overseas marine practice for the students recruited during the above period, and was paid tuition fees from the students and tuition fees.

2) On January 17, 2011, the Plaintiff opened a deposit account (hereinafter referred to as “the bank account of this case”) with the name of the deposit holder as “A (BB)”, and on January 25, 2011, with the name of the deposit holder as “SA” (hereinafter referred to as “the bank account of this case”).

3) From February 11, 2011 to July 18, 2011, the TurkeyINT Co., Ltd. deposited the instant national bank account in more than 150 times the amount calculated from 91,235 to 24,848,657 won into the instant national bank account. From February 16, 2011 to November 16, 2011, the remainder after subtracting the amount of KRW 2,000 from the amount deposited into the instant national bank account was deposited in the form of an ATM withdrawal, ATM transfer, counter withdrawal, cash withdrawal, from the point treated as KRW 602 (602).

4) From February 9, 2011 to September 21, 2011, 211, e-commerce brokerage company, and Domarket deposited the instant bank account into the instant bank account in more than 210 times. Individuals, such as KimD, also deposited into the instant bank account several times during the period from February 24, 2011 to July 25, 2011. From February 22, 2011 to October 25, 2011, the remainder after subtracting the amount of KRW 7,000 from the amount of the instant bank account opened was deposited in the instant bank account, most of which were deposited from February 22, 201 to October 25, 2011.

5) On March 23, 2011, 201, between the Plaintiff’s name and the Leewon-won agency (the trade name is “CJ FF store”). The CE entrusted the delivery of the goods to thisG, a home-based engineer belonging to the said agency. From the account of the instant bank, the instant bank transferred KRW 16,69,200 to the △△△△△△△, the representative of the said agency, the instant agent, the instant agent, the delivery fee for four occasions.

6) On the other hand, E had a place of business at ○○○○○○○-gu Seoul Metropolitan Government, and operated HHHH Co., Ltd. (hereinafter “instant corporation”) with its place of business at ○○○○○-gu, ○○○○○-gu, and △○○-gu, △○○○-dong. The EE discontinuedd its business around 2012.

7) On December 3, 2010, E consulted △△△△△, the secretary general of the A&M tax accounting office, on several occasions, about the tax savings of simplified taxable persons and the method of filing reports. On March 3, 2011, E transferred 100,000 won from the account of the instant bank to the ○○○○ Tax Accounting Office on March 10, 201, respectively.

[Reasons for Recognition] A without dispute, Gap's statements and images as well as Eul's evidence Nos. 5 through 15, 17 through 21, Eul's evidence No. 4 (including relevant numbers), and the court's order to submit each financial transaction information to Korean banks and national banks, the purport of the whole pleadings, as a whole.

C. Determination

1) Considering the aforementioned facts, the aforementioned evidence and the statements in Gap evidence Nos. 16, Eul evidence Nos. 16, Eul evidence Nos. 3 and 6, and the following circumstances that can be known by adding the whole purport of the pleadings to the testimony of witness E., there is a doubt that the actual operator of the business of this case who sold computer and peripheral devices related articles with the trade name of "BB" around 201 is E., and the plaintiff may lend the name of the business operator, the national bank of this case, and the bank account, etc. to E., and there is insufficient evidence to acknowledge that the plaintiff was operating the business of this case by only the evidence submitted by the defendant and the circumstances asserted by the defendant are insufficient

A) From the process of the tax investigation to this Court, E consistently leased the Plaintiff’s name and registered the Plaintiff as an individual business operator in 201, and sold online computers, peripheral devices, etc. from Yongsan to Yongsan. Upon deposit of the sales proceeds from the instant national bank and the Korean bank account, E purchased cash from the instant national bank and the instant corporation’s ECPU, etc., and then registered and sold the sold goods to the said bank, market, and 11 units, etc., and sold them to the said bank and the instant corporation’s ECPU, etc.

B) According to the transaction details of the instant national bank and the Korean bank account, most of the money deposited from the electronic commerce intermediaries appear to have been withdrawn in cash or check within one week from the day on which the money was located at the place of business of the instant corporation. This is consistent with the statement of the EE.

C) The EE, upon receiving a tax consultation prior to the registration of the business of the instant case, said that “the head of the tax accounting office would have become the corporate entity and would have the business entity become the corporate entity and thus, want to lend a new business entity with a new name.”

D) The completion of each of the written statements and each of the written statements (refer to the evidence Nos. 3 and 6) prepared by the Plaintiff at the time of payment of cash from the bank account of this case is not the same.

E) In light of the fact that the Plaintiff acted as Scoo ice instructors and ordered a business trip abroad, it is difficult to deem that the Plaintiff engaged in the instant business other than the business as Scoo ice instructors. On the other hand, the Plaintiff left the Republic of Korea from July 27, 201 to August 3, 201, and on July 29, 201, from the bank account of this case to the bank account of this case, 1.2 million won was deposited in the CD payment method on two occasions.

2) If so, it is difficult to view that the subject of attribution of the instant business and the business income therefrom is the Plaintiff, and thus, the instant disposition taken on the premise that the Plaintiff, a business owner, was operating the instant business is unlawful as it violates the principle of substantial taxation.

3. Conclusion

The plaintiff's claim of this case is reasonable, and the costs of lawsuit are assessed against the losing defendant. It is so decided as per Disposition.