National High Court Decision 2000Du0495 (Law No. 10, 2000)
It is unreasonable to transfer the decrease in ownership based on the area after division because the property is divided at the same price and is subject to provisional exchange.
Article 4 of the Income Tax Act (Classification of Income)
Pursuant to the disposition of imposition of KRW 30,390,50,000 for an applicant of the tax office 199.3.5 square meters, KRW 1993 square meters, KRW 30,390,50 for the above 1993 square meters, KRW 40,000 for the building site of KRW 407,00 for the same 407.13 square meters for the building site of KRW 345,54.25 square meters for the building of KRW 1/345,00 for the co-owned share (hereinafter referred to as "sub-owned real estate"), KRW 31,989,07 for the co-owned property at the time of partition, KRW 30,00 for the total value of KRW 75,00 for the building of KRW 199,30,000 for the above 20,530,000 for the building site of KRW 20,530,000 for the building site, KRW 2373739,29,4
In the process of dividing the issues of real estate jointly owned by three persons KimO, GaOOO, and MaOOOO into shares on December 24, 1993 (one-third person each), the 209.06 square meters of the site located in the OOOOOOOO in Nam-gu Incheon Metropolitan City, and the 407.13 square meters of the building are transferred to the claimant and the non-claim KimO, and the 345.5 square meters of the site located in the same OOOOO, and the 744.25 square meters of the building was transferred to the claimant and the non-claim KimO, the 52.395 square meters of the building site and the 744.25 square meters of the building were transferred to the non-claimed OO. The disposition authority decided on March 5, 199 that the claimant transferred the ownership shares to the non-claimed OO.
On September 27, 1999, the claimant appealed and filed a request for a trial on this case.
2. Opinion of the petitioner and the Commissioner of the National Tax Service;
A. The claimant's assertion
(1) Since the partition of co-owned property at the same price constitutes a provisional exchange, it is unreasonable to deem that the disposition agency grants a decrease in ownership shares based on the size after the division to transfer the property.
(2) A business operator registered in the name of the claimant for the sale of commercial buildings and filed a return and payment of value-added tax in good faith. Since unsold real estate constitutes inventory assets, it is erroneous to impose capital gains tax, apart from the taxation of business income tax on the unsold real estate.
(b) Opinions of the Commissioner of the National Tax Service;
(1) It is reasonable to deem that transfer of the property is made after the partition of co-owned property is less than the initial share after the partition of co-owned property, and the claimant claims that the real estate was divided at an equal price, but no evidence related to the claim claim is presented until the date of the request for examination, and the standard market price per unit owned by each person after the partition of co-owned property is also a substitute, and thus it cannot be deemed transfer.
(2) Three persons such as the claimant, etc., acquire the disputed real estate from the non-request staticO on the ground of sale and purchase on December 8, 1987, and sell it in lots for a period of six years ( February 198, May 199). They are only three times (2.5, May 198, and May 199). The fact that the unsold real estate was sold in lots for two years and seven months retroactively from the date of partition of co-owned property was sold in lots, and when considering the fact that the real estate was registered as the real estate rental at the time of subdivision of the disputed real estate, the income accrued in the process of dividing the disputed real estate by ownership shares, rather than the
3. Issues and judgments
A. Key issue
(1) Whether ownership shares reduced in the case of partition of co-owned property can be seen as transfer
(2) Whether the share of ownership decreases as income of real estate sales business (business income)
(b) Related statutes;
Article 4 of the Income Tax Act at the time of transfer / Income of residents shall be classified as follows:
1. Global income:
The total amount of interest income, dividend income (including the constructive dividend income; hereinafter the same shall apply), real estate income, business income, labor income and other income generated in the year concerned.
3. Capital gains:
Income accruing from the transfer of assets;
(3) The term "transfer" in subparagraph 3 of paragraph (1) means that an asset is actually transferred for price due to an investment in kind, etc. in a sale, exchange, corporation, etc., regardless of the registration or enrollment of such asset. In such cases, where a donee takes over an obligation of a donor in an onerous donation (excluding cases falling under the main sentence of Article 29-4 (2) of the Inheritance Tax Act), the portion equivalent to the amount of such obligation in the donation amount shall be deemed as the actual transfer for price of such asset. Article 20 (1) 8 of the same Act provides that "income accrued from financial, insurance, real estate, or business service business" shall be deemed as business income.
Article 36 of the Enforcement Decree of the same Act shall be the income generated from the following businesses in the scope of the income referred to in Article 20 (1) 8 of the Act:
1. through 2. (Omission)
3. Real estate trading; and
4.(Omission)" is defined as "(Omission)".
On the other hand, Article 1 (1) of the Enforcement Decree of the Value-Added Tax Act provides that "the corporeal goods stipulated in Article 1 (2) of the Value-Added Tax Act include goods, products, raw materials, machinery, buildings, and all other tangible things," and Article 1 (1) of the Enforcement Decree of the same Act provides that "the scope of the Hybol Business" of the same Act provides that "the sale or brokerage of real estate (including the case of new construction and sale of buildings) shall be indicated as the business purpose, and real estate shall be sold or acquired at least once during one taxation period for the purpose of business and sold
C. Facts and determination
(1) Whether the claimant's share in the partition of co-owned property can be deemed to have been transferred in case of the issue real estate
1) First, we examine the facts.
The claimant et al. jointly acquired the site and building located in the Dong-gu Incheon Metropolitan City OOOOOO, the same OOOOOOOO located in the same Dong-gu, and sold part of February, May, 198, May, 199, and shared co-owned property by shares of each person on December 24, 1993. The fact that 56.04 square meters and 127.8 square meters of building among the co-owned shares of the claimant and 127.8 square meters of building are reduced, and the transfer income tax was imposed on the decreased shares by the disposition authority in accordance with the certified copy of the register and the decision-making resolution.
Details of changes in shares of outstanding real estate
The shares in the divided area before the division shall be owned by 1/3 applicant KimO, 1/2000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000,0000000
2) The claimant asserts that the real estate at the time of partition of co-owned property does not fall under the transfer by exchanging it as a provisional one, and presents the co-owned property partition contract, co-owned property partition agreement, and cadastral map. The co-owned property partition under law is the exchange or sale of shares among co-owners. However, in substance, the right which has been exercised limited according to the share ratio as to the co-owned property, i.e., the right to concentrate on the specific part acquired due to the division, and continues to exist only in the specific part, and its ownership form can not be changed (see Supreme Court Decision 98Nu229, Mar. 10, 198). However, it is reasonable to deem that the portion which is subject to capital gains tax is transferred more or less than the original share after the partition of co-owned property is transferred (see Supreme Court Decision 95Da3399, Feb. 14, 1996).
Therefore, since 311,989,07 won of the appraised value of the claimant's share of the real estate at issue before partition of co-owned property reduced to 219,372,140 won after the division of co-owned property, this reduced portion constitutes the transfer of the property. Therefore, the reduced value of the claimant's share becomes the transfer value and the corresponding area among the issues real estate becomes the transfer area, and it is reasonable to calculate transfer margin and correct the tax base and tax
(2) Whether or not the share reduction ratio can be viewed as income of real estate sales business (business income)
1) The claimant asserts that since the key real estate falls under inventory assets, it should be taxed by real estate sales business, on the ground that the claimant has registered the real estate as a real estate trading business with three persons, other than regular OO, and reported the value-added tax.
2) Whether the income from the sale and purchase of real estate belongs to the business income under the Income Tax Act or is subject to the transfer income tax under the said Act shall be determined according to the ordinary social norms, taking into account whether the sale and purchase is for profit, the degree of continuity and repetition of business activities in light of the size, frequency and mode of the sale and purchase, etc. (see, e.g., Supreme Court Decision 94Nu6352, Sept. 23, 1994).
The claimant's two non-OOOOO, the site and building located in the same OOOOOO located in the Dong-gu Incheon Metropolitan City, and the sales recovery is three times (the sale in February, May, 198, May, 199) and three times (the sale in May, 199) during six years and seven months retroactively from the date of partition of co-owned property, and the fact that the real estate has been registered as a rental business at the time of division of the disputed real estate was confirmed by the National Tax Service by electronic data, and the income accrued during the division is determined to be capital gains rather than income accrued from real estate sales.
Since a request for a trial is deemed to be well-grounded as a result of the review, it shall be determined as ordered under Article 81 and Article 65 (1) 2 and 3 of the Framework Act on National Taxes.