Article 155 (16) 1 of the Enforcement Decree of the Income Tax Act: Special case of one house

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

Cheong-gu Office

The same shall apply to the order.

A. On May 15, 1991, the Plaintiff acquired ○○○○○○○-dong ○○○○○○○○○○○○○ apartment 414 Dong 108 (hereinafter “instant reconstruction apartment”) and resided in May 13, 1997 to December 27, 2002, and upon the implementation of a reconstruction project on the said apartment, invested the said apartment in the ○○○○○○○○ reconstruction Association (hereinafter “instant association”). On March 25, 2002, the said association obtained approval of the business plan under Article 33(1) of the former Housing Construction Promotion Act (amended by Act No. 6841, Dec. 302; hereinafter the same) from the head of ○○○-gu on March 25, 2002.

B. Meanwhile, on September 3, 2001, the Plaintiff acquired ○○○○○○ apartment, ○○○○○ apartment, 4 102 dong 102 (hereinafter “○ apartment”) and transferred the instant ○ apartment on October 2, 2002, and then reported and paid transfer income tax on the transfer income, and the removal of the instant reconstruction apartment began from February 14, 2003.

C. After that, on June 29, 2004, the Plaintiff transferred the right to sell the instant reconstruction apartment (hereinafter referred to as the “right to sell the instant reconstruction apartment”) to KRW 810 million, and on August 26, 2004, the Plaintiff reported and paid KRW 39,313,000 for the portion exceeding 60 million to the Defendant, deeming that the ownership of the instant reconstruction apartment constitutes non-taxation as one house for one household on August 26, 2004.

D. Accordingly, the Defendant excluded the application of non-taxation provisions on one house per household on the ground that the Plaintiff owned the instant ○ apartment in addition to the instant reconstruction apartment at the time of the approval date of the project plan, and thus constitutes two houses for one household. On January 1, 2005, the Defendant issued the instant disposition to additionally impose and notify the Plaintiff KRW 67,361,720, capital gains tax belonging to the year 2004.

[Ground for Recognition: Facts without dispute, Gap 1 evidence, and Eul 1]

2. Whether the instant disposition is lawful

A. The party's assertion

(1) Article 155 (16) of the former Enforcement Decree of the Income Tax Act provides that the defendant shall be entitled to legal fiction of transfer of one house by one household, notwithstanding the fact that a member of a reconstruction association under the former Housing Construction Promotion Act who owns an existing house corresponding to one house for one household as of the date of approval of the business plan (hereinafter referred to as the "right of sale") transfers real estate to acquire the right of sale. Thus, for the plaintiff to become a member of the association under the above provision, the plaintiff should not own other house except the reconstruction apartment at the time of obtaining the above approval of the business plan (the time of acquiring the right of sale). Since the plaintiff owned the instant apartment other than the reconstruction apartment at the time of the above approval of the business plan, the plaintiff does not constitute a reconstruction project that satisfies the non-taxation requirements of one house for one household under Article 155 (16) of the former Enforcement Decree of the Income Tax Act at the time of acquiring the right of sale (the date of approval of the business plan at the time of acquisition of the right of sale. Accordingly, the disposition of this case is lawful.

(2) For this reason, Article 155(16) of the former Enforcement Decree of the Income Tax Act applies to a housing reconstruction association that owns an existing house, regardless of whether the Plaintiff falls under one house for one household as of the date of approval of a housing reconstruction project plan, and does not own another house at the time of "transfer of the right to sell," and the Plaintiff was a member of the instant association that owns the reconstruction apartment of this case as of the date of approval of a housing reconstruction project concerning the reconstruction apartment of this case. At the time of transfer of the right to sell this case, the Plaintiff did not own any other house except the right to sell this case. Thus, the Plaintiff’s income accrued from the transfer of the right to sell this case by one household is subject to exemption of capital gains tax, notwithstanding the fact that the Plaintiff

(b) Related statutes;

○ Article 89 of the Income Tax Act

No capital gains tax (hereinafter referred to as "capital gains tax") shall be levied on the following incomes:

3. Income accruing from a transfer of such one house for one household as prescribed by the Presidential Decree (excluding expensive houses whose prices exceed the standard prescribed by the Presidential Decree) and the appurtenant land within the area calculated by multiplying the area of land to which the building is fixed by the ratio as determined by region under the Presidential Decree

○ Scope of transfer income under Article 94 of the Income Tax Act

(1) Capital gains shall be the following income generated in the relevant year:

2. Income accruing from transfer of any right to the real estate falling under any of the following items:

(a) Right to acquire real estate (including the right to acquire a building upon completion of its construction and its appurtenant land);

The former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 18705 of Feb. 19, 2005)

○ 154 Scope of one house for one household

(1) The term “one house for one household prescribed by the Presidential Decree” in subparagraph 3 of Article 89 of the Act means that a household comprised by a resident and his spouse together with the family members living together with him at the same address or same place of residence as of the date of transfer has one house in Korea as of the relevant date, and the retention period of the relevant house is not less than 3 years (in case of the house located in the subdivision, day, square village, mountain village, mountain village, and new urban area designated and publicly notified as a planned area for housing site development under Article 3 of the Housing Site Development Promotion Act, the retention period of relevant house is not less than 3 years and the residing period is not less than 1 year during the retention period): Provided, That where one household possesses one house in Korea as of the date of transfer and falls under any of the following subparagraphs, it shall not be subject to the restriction on the retention period and residing period

○ Special Cases Concerning “One House for One Household” in Article 155:

In case where a member of an redevelopment association under the Urban Redevelopment Act or a reconstruction association under the Housing Construction Promotion Act (limited to the person who owns the existing house falling under the provisions of Article 154 (1) as of the date of removal of the existing house in case where the existing house is removed before the date of authorization of management and disposal plan under Article 34 of the Urban Redevelopment Act, or the date of approval of a project plan under Article 33 of the Housing Construction Promotion Act, and the date of removal of the existing house in case where the existing house is removed before that date) transfers the status of being selected as the occupant through the association concerned (including the land appurtenant thereto), if there is no other house as of the date of transfer, it shall be

§ 156. Scope of expensive houses

(1) The term “high-priced house the value of which exceeds the standard determined by the Presidential Decree” in subparagraph 3 of Article 89 of the Act means that the sum of the actual transaction values at the time of transfer of a house and its appurtenant land (where a part of a house is transferred, it refers to the amount calculated by dividing the sum of the actual transaction values by the ratio

Urban and Residential Environment Improvement Act (No. 6852, December 30, 202), attached

Article 3 (General Transitional Measures)

The disposal, procedures, and other acts performed under the Act on Temporary Measures for the Improvement of Residential Environments by Urban Redevelopment and Urban Low-Income Residents, and the Housing Construction Promotion Act (hereinafter referred to as the "previous Acts") at the time this Act enters into force shall be deemed to have been performed under this Act.

former Housing Construction Promotion Act (amended by Act No. 6841 of Dec. 30, 2002)

○ Article 33 (Approval of Business Plan and Building Permission, etc.)

(1) Any person who intends to construct housing exceeding the number prescribed by the Presidential Decree, or to create housing sites exceeding the area prescribed by the Presidential Decree, shall prepare a project plan and obtain approval therefor from the Minister of Construction and Transportation. The same shall also apply to any modification of the project plan (excluding

C. Determination

(1) First, Article 89 subparagraph 3 of the former Income Tax Act provides that no transfer income tax shall be imposed on the income accruing from the transfer of one house for one household as prescribed by the Presidential Decree (in the case of this case, where one house for one household whose actual transaction price exceeds 600 million won, such excess amount shall be imposed only on the capital gains tax). Article 154 (1) of the former Enforcement Decree of the Income Tax Act and Article 71 (3) 3 of the former Enforcement Decree of the Income Tax Act (amended by Ordinance No. 456 of August 5, 2005) of the former Enforcement Decree of the Income Tax Act provide that one house for one household as prescribed by the Presidential Decree under Article 89 (3) 3 of the former Enforcement Decree of the Income Tax Act shall be imposed on the income accruing from the transfer of one house for three years or more, and Article 155 (16) of the former Enforcement Decree of the Income Tax Act provides that the ownership of the house at the time of the transfer of the existing house shall be 15 years or more.

(2) It is reasonable to view that the transfer income tax of Article 15 of the former Enforcement Decree of the Income Tax Act is to be determined as of the time of transfer because it is calculated as of the date of acquisition of assets at the time of 100 or more of the former Enforcement Decree of the Income Tax Act and Article 154 (1) of the former Enforcement Decree of the Income Tax Act provides that if the ownership of 15 or more houses for 10 or more households is to be non-taxable, it shall be determined as of the date of acquisition of the 15 or more houses for 100 or more households, and that the 15-year old Enforcement Decree of the Income Tax Act provides that the 15-year old Enforcement Decree of the Income Tax Act and the 15-year old Enforcement Decree of the Income Tax Act provides that the 15-year old Enforcement Decree of the Income Tax Act and the 15-year old Enforcement Decree of the Income Tax Act provides that the 15-year old Enforcement Decree of the Income Tax Act and the 15-year Enforcement Decree of the Income Tax Act shall not apply the 15-year Housing Act.

(3) In the case of this case, as seen earlier, although the Plaintiff had owned the apartment of this case at the time of acquiring the right to sell this case, the Plaintiff had already transferred the right to sell this case before transferring the right to sell this case (the transfer income tax was paid in full). The transfer of the right to sell this case did not own any other house at the time of transfer of the right to sell this case, and the right to sell this case has satisfied the requirements of residence for at least three years and for at least two years during the retention period as of the date of approval of the business plan, which is the acquisition date, and thus, the transfer of the right to sell this case by the Plaintiff is subject to tax exemption under "one house for one household." Therefore, the Defendant’s disposition of this case on a different premise

3. Conclusion

Therefore, the plaintiff's claim of this case seeking the cancellation of the disposition of this case is justified and it is so decided as per Disposition.