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

Cheong-gu Office

The Defendant’s imposition of the capital gains tax for the year 2013 against the Plaintiff on August 9, 2018 is revoked.

A. The Plaintiff acquired on May 8, 1975 or on March 30, 1973, and transferred to the Korea Rural Community Corporation a total of 49,825 square meters (hereinafter “the farmland of this case”) in the vicinity of 18 square meters, other than 200-1, 93 square meters, an OO-Eup O-type O-type O-type, as indicated in the attached Table, and transferred it to the Korea Rural Community Corporation on November 8, 2012.

B. The Plaintiff reported and paid O00 million won of capital gains tax by applying the reduced or exempted O0 million won of capital gains tax on the ground that the instant farmland was a business land, and that it was self-employed for not less than eight years.

C. In light of the fact that the Plaintiff continuously obtained earned income and business income from OO, and the Plaintiff’s resident registration place is Seoul, the Defendant deemed the instant farmland as land for non-business and excluded the application of special long-term holding deduction, and denied the fact that the Plaintiff was self-employed for at least eight years, and disposed of the Plaintiff on August 9, 2013 as stated in the purport of the claim (hereinafter the instant disposition).

[Ground of recognition] Facts without dispute, Gap 7-9 evidence, purport of whole pleadings

2. Whether the disposition is lawful;

A. The plaintiff's assertion

Since the Plaintiff had resided in the vicinity of the instant farmland around May 200 and had been engaged in agriculture continuously, the transfer income tax should be reduced or exempted because the instant farmland falls under the self-employed land for not less than eight years under Article 69(1) of the Restriction of Special Taxation Act, and the special deduction for long-term possession should be applied since the land for non-business under Article 104-3 of the Income Tax Act is not the land for non-business.

B. Determination

1) Article 69(1) of the Restriction of Special Taxation Act provides that the amount of tax equivalent to 100/100 of capital gains tax shall be reduced or exempted for income accruing from the transfer of land directly cultivated by a resident prescribed by Presidential Decree who resides in a location of the farmland for at least eight years, and Article 66(1) of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 24368, Feb. 15, 2013) provides that "resident prescribed by Presidential Decree who resides in a location of the farmland for at least eight years means a Si/Gun/Gu where the farmland is located, or a Si/Gun/Gu where the farmland is located, or a Si/Gun/Gu adjacent thereto, or a person who resides in an area within 20 km in a straight line from the farmland and directly cultivated by a method prescribed by Presidential Decree" under Article 69(1)3 of the same Act means that the resident engages in cultivating crops or growing perennial plants on his/her own farmland or growing them by one-half or more by one-half labor force.

Meanwhile, Articles 95(1) and 104-3(1)1 of the Income Tax Act defines farmland not re-established or re-developed as land for non-business during the period prescribed by the Presidential Decree during which the owner owns the land, and excludes special long-term holding deduction. According to Articles 168-6 and 8 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 26067, Feb. 3, 2015), farmland excluded from non-business land means farmland for which the owner has registered as a resident of the same Si/Gun/Gu as the location of the land, or a Si/Gun/Gu adjacent thereto, or a person who actually resides within 20 km in a straight line from the farmland and actually resides in the area within 20 km in a straight line from the said land, and the period of non-resident or re-resident exceeds a certain period (where the period of land ownership exceeds five years, the period exceeding two years from the date of the immediately preceding five years, three years from the date of the transfer, and the period exceeding 10 20/10/10).

Unless there are special circumstances, the taxpayer should have the burden of proving the above self-reliance and re-reliance.

2) In light of the following various circumstances acknowledged by adding the entire purport of the pleadings to each of the statements in Dogs, Gap 31, Eul 32, Eul 2, and Eul 6 (including various numbers), the evidence submitted by the plaintiff alone is insufficient to acknowledge the fact that the plaintiff did not have himself/herself nor herself nor did he/she go again for 8 years or longer after the acquisition of the farmland of this case, or that the period during which he/she did not go to any one of the above certain periods, and there is no other evidence to prove otherwise.

① The Plaintiff’s registered domicile was not registered in OO as of October 10, 1968 to October 26, 198. However, only registered in OO as of May 11, 198 to December 26, 198.

② From August 28, 1970, the Plaintiff operated a BB industrial company located in the OO, from January 4, 1999 to September 8, 2001, operated a DNA bath located in the OOO from April 11, 2003 to January 18, 2006.

③ From August 1, 1988 to May 12, 2000, the Plaintiff served as the representative director of the EE Industry Corporation, and thereafter serves as an inside director. Since the year 2000, the Plaintiff asserted that he had concentrate on agriculture, at least KRW 00 million of earned income is earned every year.

④ The instant farmland is considerably larger than 49,825 square meters, and it is difficult to deem that the aged Plaintiff directly cultivated 1/2 or more of farming work with his own labor.

(5) Even in accordance with the entries in the farmland ledger, neither of the farmland in this case shall have a period of self cultivation of at least eight years.

3. Conclusion

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