Article 84(Period for tax investigations) #
(1) The head of a local government shall determine the period for tax investigation by up to 20 days, based upon items of taxation, type and scale of business subject to investigation, level of difficulty of investigation, etc.; provided, where any of the following grounds arises, he or she may extend the period for tax investigation by up to 20 days from the day such grounds cease to exist: <Amended on Dec. 26, 2017; Dec. 24, 2018; Dec. 31, 2019>
1. Where it is evident that a taxpayer is evading an investigation, such as by concealing, delaying in submitting or refusing to submit books, etc.;
2. Where an investigation into customers, on-site confirmation of customers or on-site confirmation of financial transactions is necessary;
3. Where his or her alleged evasion of local taxes is detected or a tax investigation case develops into an offense case in the course of investigation;
4. In cases falling under other grounds determined by the head of a local government, such as suspension, etc. of investigation etc. due to a natural disaster or labor dispute;
5. Where a person subject to tax investigations files an application for extending the period for investigation for explanation, etc. on suspicion of tax omission;
6. Where a taxpayers’ advocate deems that it is necessary to verify additional facts in relation to the explanation about alleged evasion of taxes made by a person subject to tax investigations.
(2) Where it is difficult for the head of a local government to conduct a tax investigation for grounds prescribed by Presidential Decree, such as a delay in the submission of data caused by a taxpayer, the head of a local government may suspend the tax investigation. In such cases, the period for suspension shall not be included in the period for tax investigation and the extended period for tax investigation under paragraph (1).
(3) A tax official shall not question a taxpayer in relation to a tax investigation and shall not inspect or investigate books, etc. or ask submission of books, etc. during the period of suspension of a tax investigation under paragraph (2). <Added on Dec. 24, 2018; Dec. 31, 2019>
(4) Where the head of a local government suspends a tax investigation pursuant to paragraph (2), he or she shall immediately resume the tax investigation if a ground for suspending the same ceases to exist; provided, where it is necessary to urgently resume the tax investigation, such as securing tax receivables, he or she may resume the tax investigation even before the reason for suspension ceases to exist.
(5) Where the head of a local government intends to extend the period for tax investigation pursuant to the proviso of paragraph (1), he or she shall notify a taxpayer (including a tax manager under Article 139, if appointed) in writing of grounds for extending the period for tax investigation and the extended period in advance, and where he or she suspends or resumes the tax investigation pursuant to paragraph (2) or (4), he or she shall notify a taxpayer of the reason therefor in writing. <Amended on Dec. 24, 2018>
(6) The head of a local government shall endeavor to shorten the period for tax investigation, and when he or she deems no further investigation is necessary after examining tax compliance, such as transparency in bookkeeping and accounting, he or she may close the tax investigation even before the period for tax investigation expires.
Article 84-2 (Prohibition of keeping books (1) Tax officials shall not keep any books, etc. of taxpayers at any local governments for the purpose of tax investigations (including investigations into tax offenses; hereinafter in this Article the small shall apply).
(2) Notwithstanding paragraph (1), if any of the grounds provided in the subparagraphs of Article 82 (2) arises, a tax official may temporarily keep account books, etc. submitted at the discretion of a duly authorized persons, such a taxpayer, holder or custodian, with the consent of the taxpayer at a local government to the minimum extent necessary for the purposes of his or her investigation.
(3) Where a tax official intends to temporarily keep a taxpayer’s books, etc. at a local government under paragraph (2), the tax official shall obtain consent to temporary keeping from the taxpayer, and issue a certificate of temporary keeping to the taxpayer.
(4) Where a taxpayer requests the return of his or her books, etc. temporarily kept under paragraph (2), a tax official shall return the books, etc. to the taxpayer within 14 days of the date of the request for return; provided, the tax official may extend the period of keeping for up to 14 days only once with the approval of a taxpayer advocate, if necessary to achieve the purposes of the investigation.
(5) Notwithstanding paragraph (4), where a taxpayer request the return of his or her books, etc, temporarily kept under paragraph (2) and a tax official finds that such return will not hinder his or her tax investigation, the tax official shall immediately return the requested books, etc. to the taxpayer.
(6) In returning books, etc. to a taxpayer under paragraphs 4 and 5, a tax official may keep copies of the books, etc. and may request the taxpayer’s signature or seal confirming that the copies are same as the originals.
(7) Except as provided in paragraphs (1) through (6), matters necessary for methods and procedures for temporarily keeping books, etc. shall be prescribed by Presidential Decree.
[This Article Added on Dec. 31, 2019]