Article 69 of the Restriction of Special Taxation Act (Reduction or Exemption of Transfer Income Tax for Self-Cultivating Farmland)

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

A. On October 14, 2004, the Plaintiff transferred four parcels (excluding the five parcels of land, excluding the two parcels of land, and hereinafter referred to as “each parcel of land in this case”) to Kim○, ○○○-do, Jeonnam-gun, ○○○-do, 373-3,228 square meters, and four parcels of land (excluding the two parcels of land among the five parcels of land; hereinafter referred to as “each parcel of land in this case”), but did not report the transfer income tax on the ground that the said transfer constitutes reduction or exemption of the transfer income tax on self-

B. Accordingly, the Defendant calculated gains from transfer of each of the instant lands and the remaining two parcels of forest land based on the standard market price on the grounds that the Plaintiff had resided in each of the instant lands for not less than eight years and did not own each of the instant lands, and issued the instant disposition that determined and notified capital gains tax of KRW 1,697,700 to the Plaintiff on June 9, 2005.

[Ground of recognition] Facts without dispute, Eul evidence Nos. 1, 2, 3, Eul evidence No. 4-1, 2-2, the purport of the whole pleadings

2. Whether the instant case is lawful

A. The plaintiff's assertion

The Plaintiff acquired each of the instant lands on October 27, 1953, different from the date of acquisition on the registry, and liveded with each of the instant lands for at least eight years thereafter. The Plaintiff asserts that even if the acquisition date of each of the instant lands was around 1981, which is the date of acquisition on the registry, the Plaintiff resided in ○○○, and used weekend and holidays to grow up to 2004, which is the date of acquisition on the registry, the transfer income tax on the transfer of each of the instant lands shall be exempted pursuant to Article 66 of the Restriction of Special Taxation Act.

B. Relevant statutes

Income Tax Act

Article 98 (Time of Transfer or Acquisition) In calculating gains on transfer of assets, the time of transfer and time of transfer shall be determined by Presidential Decree.

Income Tax Act

Article 162 (Time of Transfer or Acquisition)

(1) The time of acquisition and transfer under Article 98 of the Act shall be the date of liquidation of the price of relevant assets (if the transferee agrees to bear the capital gains tax and additional tax of capital gains tax on the transfer of relevant assets, excluding such capital gains tax and additional tax of capital gains tax) except in the following cases:

1. Where the date of the settlement of price is not clear, the date of registration, receipt of registration, or transfer date entered in the register, registry, list, etc.;

2. Date of receipt of the registration entered in the register, register, list, etc. where the transfer of ownership (including the registration and the opening of the name) has been made before the price is settled;

Restriction of Special Taxation Act (amended by Act No. 7775 of Dec. 29, 2005)

Article 69 (Abatement or Exemption of Transfer Income Tax for Self-Cultivating Farmland)

(1) With respect to the income accruing from a transfer of land as prescribed by the Presidential Decree, which is directly cultivated by the resident as prescribed by the Presidential Decree, for not less than 8 years [in case where the farmland in the agricultural promotion area under Article 32 of the Farmland Act is transferred to the Korea Agricultural and Rural Infrastructure Corporation Act (hereafter in this Article, referred to as the “Korea Agricultural and Rural Infrastructure Corporation”) or to the corporation as prescribed by the Presidential Decree which mainly runs the agriculture, not later than December 31, 2005, not later than 5 years, and in case where the farmland subject to the direct payment subsidy as prescribed by the Presidential Decree is transferred to the Korea Agricultural and Rural Infrastructure Corporation or the agricultural corporation for not less than 3 years, not later than 3 years, not later than December 31, 2010] and is subject to the taxation of agricultural income tax (including the non-taxation, reduction and exemption, and small collection object), the tax amount equivalent to 1

Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 19329 of Feb. 9, 2006)

(1) For the purpose of the main sentence of Article 69 (1) of the Act, the term “resident prescribed by the Presidential Decree who resides in the seat of the farmland” means a farmer who has cultivated while living in the area (including the area corresponding to the relevant area at the time of commencement of cultivation, but does not fall under it due to reorganization of administrative district) falling under any of the following subparagraphs for not less than 5 years in case where he transfers the farmland to the Korea Agricultural and Rural Infrastructure Corporation under the Korea Agricultural and Rural Infrastructure Corporation and Farmland Management Fund Act (hereafter in this Article, referred to as the “Korea Agricultural and Rural Infrastructure Corporation”) or to the corporation under paragraph (2) or for not less than 3 years in case where he transfers the farmland to the Korea Agricultural and

1. An area in a Si/Gun/Gu (referring to an autonomous Gu; hereafter the same shall apply in this paragraph) where farmland is located;

2. An area within a Si/Gun/Gu adjacent to an area referred to in subparagraph 1.

(4) For the purpose of the text of Article 69 (1) of the Act, the term “land as prescribed by the Presidential Decree” means the farmland, for which one has cultivated itself for not less than 8 years (in case of transfer to the Korea Agricultural and Rural Infrastructure Corporation or the corporation under paragraph (2), 5 years; in case of transfer to the Korea Agricultural and Rural Infrastructure Corporation or the corporation under paragraph (3), 3 years) from the time of acquisition until the time of transfer, excluding the farmland falling under any of the following subparagraphs. In this case, in calculating the period of farming inherited farmland, the period acquired and cultivated by the decedent shall be

(c) Fact of recognition;

(1) With respect to each of the instant lands listed in the separate sheet No. 1 among the instant lands, registration of ownership transfer was granted in the name of the Plaintiff for the reason of sale on October 27, 1953 under the former Act on Special Measures for the Registration, etc. of Ownership of Real Estate (Act No. 3094) on July 6, 1981, and registration of ownership transfer was granted in the name of the Plaintiff under the name of the Plaintiff on June 16, 1981 under the same Act.

(2) The Plaintiff, who was born in 1954, was living in ○○○○○ 406, Jeonnam-gun, and was transferred to ○○○○○ 894-39 on Nov. 27, 1979. On May 6, 1980, ○○ 406 on May 6, 1980, again transferred to ○○ ○○ ○○ 889 on Aug. 14, 1980. Thereafter, ○○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ 406 on Feb. 2, 2000 while living in ○○ ○○ ○○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ Gun.

(3) In the farmland ledger against the Plaintiff, each of the instant land is not indicated in the farmland ledger with respect to the Plaintiff, and the farmland stated in the said farmland ledger is owned by the Plaintiff red ○○, the Plaintiff’s mother, or leased and cultivated by a third party.

[Ground of recognition] Facts without dispute, Gap evidence 2, Gap evidence 4 and 5, and the purport of the whole pleadings

D. Determination

(1) First, in calculating gains from the transfer of assets at the time of acquisition of each of the instant lands, the time of acquisition and the time of transfer should be determined in accordance with Article 98 of the Income Tax Act and Article 162 (1) of the Enforcement Decree of the Income Tax Act. If the date of settlement of the price is unclear, the date of receipt of registration recorded in the land register shall be deemed the time of acquisition. In this case, the Plaintiff asserted that the Plaintiff acquired each of the instant lands on October 27, 1953, which is the date of acquisition on the register of land listed in attached Table 1, listed in attached Table 1, but it is difficult to view that the Plaintiff acquired each of the instant lands on the above date because the Plaintiff was born, but it is unclear that the date of settlement of the price related to the acquisition of each of the instant lands is not clear. Thus, the Plaintiff cannot be deemed to have acquired each of the instant lands listed in attached Table 1, the registration of ownership transfer was completed in the name of the Plaintiff as to each of the instant lands.

(2) Next, the Si/Gun/Gu in which each land of this case is located in accordance with Article 69(1) of the Restriction of Special Taxation Act and Article 66(1) of the Enforcement Decree of the same Act in order for the Plaintiff to have the capital gains tax reduced or exempted

The farmland must be cultivated directly in the area or adjacent area for at least eight consecutive years, and at this time, the farmland must be cultivated directly by the transferor as well as by the family members living or living together with the same household, or by employing another person under the responsibility and calculation of the transferor (see, e.g., Supreme Court Decision 94Nu1859, Feb. 3, 1995).

In this case, according to the above facts, the period of residing at the location of each land of this case from June 16, 1981 or July 6, 1981 to October 14, 2004 where the Plaintiff acquired each land of this case was transferred is less than 4 years and 10 months (from February 2, 2000 to October 14, 2004) and it is obvious that the Plaintiff did not reside at the location of each land of this case or adjacent areas during the remaining period.

(3) Therefore, the plaintiff's assertion based on the premise that the plaintiff's own land of this case was around 8 years is without merit.

3. Conclusion

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