Revocation of Disposition Imposing Inheritance Tax

In calculating the taxable value of inherited property, if there is any balance remaining after deducting debts, etc. from the value of inherited property, it shall be deemed "0", and whether it may be deducted by adding up the value of donated property.

Article 13 of the Inheritance Tax and Gift Tax Act

Seoul High Court 2005Nu20674 Disposition of revocation of the imposition of inheritance tax ( May 10, 2006)

The part concerning the Plaintiff’s failure is reversed, and that part of the case is remanded to the Seoul High Court.

We examine the grounds of appeal.

Article 13(1) of the Inheritance Tax and Gift Tax Act (hereinafter referred to as the “Act”) provides that the taxable amount of inheritance taxes shall be calculated by adding the amount of property donated by an ancestor to his heir within 10 years before the date inheritance commences and the value of property donated by an ancestor to a person who is not his heir (hereinafter referred to as “pre-paid property value”) within five years before the date inheritance commences, after subtracting public imposts, funeral expenses, and debts (hereinafter referred to as “debts, etc.”) from the value of inherited property under the provisions of Article 14 of the Act from the value of inherited property, thereby preventing acts of avoiding or reducing the burden of inheritance tax in advance

As such, the purpose of legislation that adds the value of the pre-living donated property to the taxable amount of inheritance and the above provision requires that the value of the pre-living donated property be added after deducting the debts, etc. from the value of the inherited property, and there is no separate provision that the value of the inherited property less the debts, etc. shall be deemed zero in the case of the incidental number, and where the value of the inherited property minus the debts, etc. from the value of the inherited property is incidental (-), it shall be deemed zero in the case of the inheritance tax, and where the taxable amount of inheritance tax is calculated by deeming the amount of the inheritance tax as zero in the case of the total property subject to inheritance tax including the pre-living donated donated property, even if the inheritance debts, etc. exceed the inherited property, there is no difference between the inheritance debts, etc. and the inheritance debts, etc. even if the inheritance debts, etc. exceed the inherited property, it is reasonable to calculate the taxable amount of inheritance tax, and when calculating the amount of inheritance tax, it is reasonable to add the value of the pre-existing donated donated property based on the deduction balance.

Nevertheless, the court below held that if the debt, etc. is deducted from the value of the inherited property of this case, the court below

Recognizing the fact that there is no balance remaining after deduction, the total amount of the value of the pre-paid donated property shall be the taxable amount for calculating the taxable amount of inheritance taxes. Such judgment of the court below is erroneous in the misapprehension of the legal principles on the no taxation without law and the calculation of the taxable amount of inheritance taxes under Article 13 (1) of the Act, which guarantee the legal stability and predictability of the people's property rights and people's lives, thereby affecting the conclusion of the judgment. Thus,

Therefore, the part of the judgment of the court below regarding the plaintiff's failure shall be reversed, and this part of the case shall be remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices.