Article 163 of the Enforcement Decree of the Income Tax Act

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

A. On November 29, 2010, the Plaintiff sold 00,000,000,000,000 OO-dong 00 O-dong 356.4m2, and 124.63m2, 115.21m2, 145.86m2 (hereinafter collectively referred to as the “instant land” and “A-dong 3m2,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,00

B. On January 31, 201, the Plaintiff filed a preliminary return of capital gains tax on the instant building with the amount calculated by applying the estimated deduction rate (13% of the standard market price at the time of acquisition) to the Defendant as one house for one household, and as non-taxation for the remainder of the real estate except for the instant building B (hereinafter “real estate subject to taxation of this case”), the transfer price of KRW 000,000, which is the value of the taxable real estate subject to taxation of this case, computed within the ratio of the standard market price at the time of transfer, shall be the transfer price, and the acquisition price shall be the acquisition price converted into the standard market price at the time of acquisition, and the amount calculated by applying the estimated deduction rate (13% of the standard market price at the

C. After conducting a tax investigation on September 4, 201, the Defendant corrected and notified the Plaintiff of KRW 000 of the transfer income tax for the year 2010 (hereinafter “instant disposition”), and the detailed methods and details of calculation are as follows.

O Transfer Value: Transfer value of the real estate subject to taxation of this case calculated in proportion to the standard market price at the time of transfer 000 won.

O Acquisition Value: ① For the instant land and building A, each amount calculated by converting the transfer value into the standard market price at the time of acquisition, and ② for the instant building newly built on March 19, 2010 by the Plaintiff, the aggregate of KRW 000 for the new construction cost and KRW 000 for the acquired and registered taxes (=00 won +00 won)

O and other necessary expenses: ① for the instant land and building A, each amount calculated by applying estimated deduction rates (x3% of the standard market price at the time of acquisition) pursuant to Article 97(1)1 of the former Income Tax Act (amended by Act No. 10408, Dec. 27, 2010; hereinafter referred to as the “former Income Tax Act”) and Article 163(6) of the former Enforcement Decree of Income Tax Act (amended by Presidential Decree No. 22034, Feb. 18, 2010; hereinafter referred to as the “former Enforcement Decree of Income Tax Act”) for each of the instant land and building B, and ② In the instant building C, each amount calculated by applying estimated deduction rates (x3%) pursuant to Article 163(6) of the former Enforcement Decree of Income Tax Act (amended by Presidential Decree No. 22034, Feb. 18, 2010; and ② in the instant building C, the total amount of brokerage commission and commission

D. On September 24, 2011, the Plaintiff filed an appeal with the Tax Tribunal, which was dismissed on December 1, 2011.

[Ground of recognition] Facts without dispute, Gap evidence 4, 10 through 13, 24, Eul evidence 1 to 3, the purport of the whole pleadings

2. The plaintiff's assertion is as follows.

The Defendant’s disposition that the Plaintiff did not deduct the expenses for new construction of the instant building and the fees for certified tax accountants from among the transfer of the instant real estate is unlawful.

3. Related statutes;

Attachment 'Related Acts and subordinate statutes' shall be as shown.

4. Determination

A. According to Article 97(3)2 of the former Income Tax Act and Article 163(6) of the former Enforcement Decree of the Income Tax Act, where the acquisition value as an acquisition value cannot be confirmed at the time of acquisition and thus the acquisition value recognized by conversion value is deducted, necessary expenses, other than acquisition value, are equivalent to 3% of the standard market price of land and buildings at the time of acquisition, i.e., the estimated deduction amount, and thus, separate

B. In rendering the instant disposition, the Defendant: (a) considered the construction cost of the instant building and the aggregate of the acquisition and registration taxes as the acquisition value and deducted the transfer margin; (b) considered the amount calculated by applying the estimated subscription rate for the instant land and building A, in which the actual transaction price at the time of acquisition cannot be verified; and (c) in the instant building C, the amount calculated by applying the estimated subscription rate for other necessary expenses; and (d) as for the instant building C, in which the actual transaction price can be verified, the amount calculated by dividing the aggregate of the opening fees and the tax accountant’s fees among the occurrence related to the transfer of the instant real estate, by the standard market price, is deducted from the transfer margin, considering the transfer of the instant building, and other necessary expenses incurred by the transfer of the instant building. As seen earlier, the Defendant already deducted the construction cost of the instant building from the transfer margin after recognizing it as the acquisition value of the instant building. As long as the brokerage commission and the tax accountant’s or tax accountant’s fees related to the transfer of the instant real estate are deducted by recognizing it

5. Conclusion

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