Whether the comprehensive acquisition of business is also applicable;

Although the Plaintiff entered into the instant contract to receive the payment of construction cost, it is reasonable to see that the Plaintiff was a comprehensive acquisition of the business, as it comprehensively succeeded to the rights and obligations of BB, a lessor.

Article 10 of the Value-Added Tax Act: Special case of supply of goods

2018Guhap67503 Disposition rejecting the rectification of value-added tax

AAAA

The director of the tax office.

November 30, 2018

on October 25, 2019

1. The plaintiff's claim is dismissed.

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

Cheong-gu Office

The Defendant’s rejection of correction of KRW 000 of the value-added tax for 1st 201 X. X. 201 X. to the Plaintiff is revoked.

1. Details of the disposition;

A. The Plaintiff is a company that engages in the construction business, etc. BB registered as a real estate business and rental business on X. X. 201X. The Plaintiff entered into a construction contract for the construction of a main complex building to XX (contract amount: KRW 0 billion, and period of construction: XX. x. x. 201 X. 201 X. The Plaintiff completed the construction contract around X in 201 X. 201.

The amount of KRW 0 billion out of the purchase price shall be succeeded to the obligation of theCC Bank, and the amount of KRW 000 shall be paid as an attempted amount of construction price.

1. Land for neighborhood facilities: 00 won;

2. Neighborhood facility buildings: 000 won (excluding value-added tax: 00 won);

3. Parts of housing: 00 won;

B. From X. 201X. X. BB, the Plaintiff purchased the pertinent main complex building and its land (hereinafter collectively referred to as “instant real estate separate from value-added tax”) from 000 won (hereinafter referred to as “instant contract”). The Plaintiff completed the registration of ownership transfer with respect to the portion of the neighboring facility Nos. 000, 000, and 000 (hereinafter referred to as “the instant building”).

C. The Plaintiff was issued a tax invoice (hereinafter “instant tax invoice”) from BB stating “Date of Preparation: X. item: 00 won (No. 101: million won, KRW 201 billion: KRW 00,000, KRW 001: KRW 301:00,000, KRW 301:00 billion).”

D. At the time of the preliminary return of the value-added tax for X period 201X, the Plaintiff filed an application for rectification to the Defendant for refund of KRW 0 million of the value-added tax scheduled for X period 201X as to the instant tax invoice.

E. The Defendant rejected the Plaintiff’s claim for correction on X. X. 201 X (hereinafter “instant disposition”) on the ground that the Plaintiff was transferred a business that is not subject to value-added tax, and thus, the Plaintiff cannot deduct the input tax amount.

[Reasons for Recognition] Facts without dispute, Gap 1, 2, 7, 9, 10, 11, Eul 1 through 4, and 8, the purport of the whole pleadings

2. Relevant statutes;

It is as shown in the attached Form.

3. Whether the instant disposition is lawful

A. Summary of the plaintiff's assertion

The Plaintiff acquired the instant building not by acquiring the instant building in order to take over the real estate leasing business of BB, but by means of payment in kind such as construction cost, loan, etc. Accordingly, the instant disposition that deemed that the Plaintiff received a lease business from BB is unlawful.

B. Facts of recognition

According to the above-mentioned facts, Gap's evidence Nos. 3, 5, 6, 7, 15, 16, 17, and Eul's evidence Nos. 1, 2, 3, 5, 7, 9, 10 and the whole purport of the pleadings, the following facts may be acknowledged:

1) The Plaintiff had a claim for construction cost of KRW 000 and a loan claim of KRW 000 with respect to 201 X. X. BB.

2) The Plaintiff and BB determined the sales price of the instant real estate X. X. The sales price of the instant real estate was KRW 000,000, and the instant contract was concluded with BB to succeed to the obligations of theCC bank and to pay KRW 000 as an attempted construction price.

3) At the time of the instant contract, KRW 10X, among the instant buildings, was leased to DoD, and KRW 20X and KRW 30X were in a public room. The Plaintiff entered into a lease agreement with respect to DoD and Nos. 10 X as the same content as the previous contract regarding DoD and Nos. 10 X (a security deposit is KRW 0 million received by BB).

4) The Plaintiff was requested to a licensed real estate agent around X in 201 X, or consulted at a real estate trust company about the sale, etc. of the instant real estate.

5) The Plaintiff: X. 201X. X. “Opening Date: X. X. 201X. x. x. location: The instant real estate lawsuit.

Re-place, main business name: Real estate business, main business name: Lease (the above business registration was closed in accordance with the application of X. X. unit registration, and was added to the place of business of the head office from X. 201X. to the place of business of the head office).

BB filed a report on the closure of business: X. 201X. X. 201X. X. 201 X. : X. 201X. X. 200 won of value-added tax has been in arrears until now, while BB filed a final return after the deadline for value-added tax on the closure of X. 201 X. 201 X. 200.

6) The Plaintiff filed a value-added tax return on the leased income amount generated from the instant building from X in 201X.

C. Determination

1) Article 10(8)2 of the former Value-Added Tax Act (amended by Act No. 15223, Dec. 19, 2017) provides that “The transfer of business, as prescribed by Presidential Decree, shall not be deemed the supply of goods.” The purport of such provision is that the transfer of business is exempt from the transfer of business by stipulating that “The transfer of business is ordinarily the transaction amount and the value-added tax amount thereon, which is so large that the transferee would have to deduct the input tax amount without any exception, even if it is anticipated that the transferee would have to deduct the input tax amount without any exception.” The imposition of the output tax amount for such transaction is based on the consideration of tax or economic policy that the transferee would have to pressure unnecessary funds and avoid this (see, e.g., Supreme Court Decision 2004Du10593, Dec. 10,

Accordingly, Article 23 of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 27838, Feb. 7, 2017) provides that the comprehensive succession of all rights and obligations with respect to the transfer of business shall be made, but it shall include where the transferee adds a new type of business, other than the business succeeded, or changes the type of business." or where the transferee succeeds to the business without including the account receivable among rights and obligations, it shall be deemed that the business is comprehensively succeeded to the business.

Whether a contract constitutes a supply of goods subject to value-added tax or a transfer of business subject to value-added tax-free business shall be deemed to be comprehensively taken into account the motive, circumstance, content, and subsequent changes in the status of the transferor and transferee of the relevant contract. However, the legislative intent and the content of the Enforcement Decree shall also be sufficiently considered.

2) According to the facts acknowledged earlier and the purport of the entire pleadings, the Plaintiff acquired the instant building to receive payment for the construction cost, etc. from BB, and at present, endeavored to sell the instant building.

However, considering the following facts and circumstances, it is reasonable to view that the Plaintiff’s transfer of the instant building from BB as “transfer of business” under Article 10(8)2 of the Value-Added Tax Act. The Plaintiff’s assertion cannot be accepted.

A) The Plaintiff succeeded to the existing lease agreement through the instant contract, and became able to lease the instant building. In addition, the Plaintiff acquired the instant building and registered its business as a leasing business, and thereafter, reported the value-added tax on the rent incurred from the instant building. Meanwhile, BB reported the closure of business due to the transfer of business.

Although the Plaintiff entered into the instant contract to receive the payment of construction cost, the Plaintiff comprehensively succeeded to the rights and obligations of BB, a lessor.

B) Value-added tax is a tax that is collected at various stages of general consumption tax or transaction. If the supply of the building of this case is subject to value-added tax, the tax is imposed on the Plaintiff’s consumption, but the tax is walking from BB. In other words, BB is paid by the State after being included in the purchase price or separately paid value-added tax (Article 52(4) of the former Value-Added Tax Act). The Plaintiff and BB paid 00 won of value-added tax on the building of this case by the contract of this case. However, if the supply of the building of this case is subject to non-taxation, the Plaintiff may not pay the said amount to BB. Accordingly, even if transferring the building of this case, it is no less favorable to the Plaintiff.

C) Article 10(8)2 proviso of the former Value-Added Tax Act provides that even if a business is transferred, “if a person who received the business collects and pays the value-added tax from the recipient of the business, when he pays the price, the person who received the payment shall be subject to value-added tax.” However, the Plaintiff and BB did not pay the value

3. Conclusion

The claim of this case is dismissed as it is without merit, and it is so decided as per Disposition.