Case Number of the previous trial
Cho High Court Decision 2007Gu3802 (No. 19, 2008)
Title
Even if it is temporarily leased, it falls under real estate sales business if it is for business purpose.
Summary
Since a real estate lease act was conducted as a part of a real estate sale business regardless of the form of registration of a rental business operator, it is difficult to regard it as a comprehensive transfer of real estate rental business that is exempt from the imposition of the value-added tax as a real
The decision
The contents of the decision shall be the same as attached.
Related statutes
Article 1 (Taxable Objects)
Article 22 (Additional Tax)
Text
1. All of the plaintiff's claims are dismissed.
2. The costs of lawsuit shall be borne by the Plaintiff.
Purport of claim
The Defendant’s imposition of value-added tax 202,862,580 on July 2, 2007 against the Plaintiff on July 2, 2007 is revoked.
Reasons
1. Circumstances of the disposition;
A. On June 7, 2002, the Plaintiff acquired (the Plaintiff’s share: 2/3, 1248-5, 754.7 square meters (hereinafter “instant land”) jointly with the Non-Party Lee Dong-tae (the Plaintiff’s share: 2/3, and 1/3) on June 7, 2002, and on October 18, 2002, the opening date of the business was July 11, 2002; the location of the business was 1248-5, the registration number of the business as the real estate leasing business (the registration number: 503-14-6405) on the instant land; on May 7, 2003, the Plaintiff newly constructed the instant land and the 6th ground-based neighborhood neighborhood living facilities (the Plaintiff’s share was 2:30,000,000 won and the building was 4:50,000,00) on the instant land.
B. Rent income (rent and rent) accrued by the date of the closure of the rental business operator for the real estate in this case
On June 30, 2005, the value-added tax was reported as a general taxable person, and on June 30, 2005, the income tax was reported and paid in KRW 3,068,308 following the transfer of real estate in this case.
C. Regarding this, the Defendant deemed that the Plaintiff and Lee Tae-tae transferred the instant real estate for the purpose of running real estate sales business as a joint business proprietor. On July 2, 2007, the Defendant corrected and notified the Plaintiff of KRW 202,862,580 for the first term portion of value added tax in 2005 (hereinafter “instant disposition”).
D. On September 27, 2007, the Plaintiff filed a request with the Tax Tribunal for a trial on September 27, 2007, but the tax trial was conducted.
The plaintiff's appeal was dismissed on May 19, 2008.
[Ground of recognition] Facts without dispute, Gap evidence 1 through 5 (including branch numbers for those with additional numbers; hereinafter the same shall apply), Eul evidence 1 to 6, the purport of the whole pleadings
2. Whether the dispositions of the instant case are legal.
A. The plaintiff's principal
(1) The Plaintiff acquired the instant land in collaboration with Lee Tae-tae for the purpose of running a real estate leasing business, registered its business, and newly constructed the instant building on that ground, and engaged in a real estate leasing business. On April 1, 2005, the Plaintiff transferred all the leasing business including the instant land and the instant building, which is the object of the leasing business, to Kim ○ and one other, and the assignee also engages in a leasing business while maintaining the identity of the business, such transfer constitutes a transfer of business which is exempt from taxation pursuant to Article 6(6)2 of the Value-Added Tax Act. Since the Defendant imposed value-added tax on the Plaintiff by deeming that the instant real estate transfer was conducted to conduct a real estate selling business, the instant disposition was unlawful
(ii) Even if the transfer of household real property constitutes real estate sales, the plaintiff shall:
Considering the transfer of the instant real estate after the transfer of the business, the Plaintiff cannot be deemed to have filed a false return for the purpose of reducing the tax burden, and it is difficult to deem that there was an intention to evade tax, and it constitutes an error in the classification of income. Therefore, it is unreasonable to impose additional tax on the Plaintiff on negligent tax returns.
(b) Related statutes;
Article 1 (Taxable Objects)
Article 22 (Additional Tax)
C. Determination
(1) Whether the transaction of real estate constitutes a real estate trading business shall be determined in light of social norms, considering whether the transaction purpose is profit-making, and whether the transaction continues to be and repeated to the extent that it can be seen as business activities in light of its size, frequency, mode, etc., and since Article 1(2) of the Enforcement Rule of the Value-Added Tax Act is merely an exceptional provision that can be seen as a real estate trading business, so long as the real estate transaction as a whole continues to be and repeated under its business purpose, it does not deny the business feasibility of the transaction during the pertinent taxable period (see Supreme Court Decision 96Nu8758, Oct. 11, 1996). Further, the "transfer of business" under Article 6(6) of the Value-Added Tax Act means that the transaction of real estate shall be deemed as a real estate trading business entity maintaining the unity of business by comprehensively transferring human and physical facilities, including property for business, and it shall be deemed as a new real estate trading business entity’s non-taxation to the extent that it is recognized as a new real estate trading business entity. 90.
In full view of the following circumstances acknowledged by the above legal principles and the evidence as follows, (i) the period of the Plaintiff acquired the instant building in collaboration with the instant building, and (ii) the period of real estate leasing business is about 2 years, and (ii) the Plaintiff and joint business operators acquired the instant land in cooperation with the Plaintiff for the purpose of leasing or newly constructing the instant building for the purpose of selling or constructing the instant real estate, and (iii) the Plaintiff did not easily sell the instant building after the Plaintiff’s demand to repay the Plaintiff’s debt, and sold the instant real estate without receiving the payment demand. In full view of the following, it is reasonable to deem that the Plaintiff transferred the instant real estate as part of real estate sales business after newly constructing the instant building for the purpose of selling the instant real estate from the first time to the date of transferring it, and that the Plaintiff’s lease of the instant real estate is merely about 2 years, and that the Plaintiff’s sale of the instant real estate as part of the real estate sales business, regardless of the type of value-added tax on the instant real estate leasing business operator’s real estate as part of the sale registration.
Therefore, the defendant's objection disposition is legal, and the principal of interest of another plaintiff shall be the reason for the partial principal of interest.
shall not be effective.
(2) In order to facilitate the exercise of taxation right and the realization of tax claims, additional tax under the tax law is an administrative sanction imposed by a taxpayer who violates a tax return, tax liability, etc. under the law without justifiable grounds, and the taxpayer’s intent or negligence is not considered as a matter of law (see Supreme Court Decision 93Nu20467, Aug. 26, 1994). The Plaintiff’s act of transferring real estate in this case misleads the transfer of a business subject to non-taxation under the Value-Added Tax Act, and even if there are circumstances where there was no intention to evade tax, it is merely the fact that the Plaintiff did not properly know of the tax law and does not constitute justifiable reasons. Thus, there is no reason for the Plaintiff’s assertion on this part.
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.