Even if the actual transaction price is confirmed, in cases where the preliminary return on transfer margin or the final return on tax base is not made, the criteria for calculating transfer margin (=base market price)

The provisions of Articles 23(4) and 45(1)1 of the former Income Tax Act (amended by Act No. 4281 of Dec. 31, 1990), and Article 170(4)3 of the Enforcement Decree of the same Act (amended by Presidential Decree No. 12767 of Aug. 1, 1989) are converted from the existing actual transaction value principle to the standard market price principle in the report of transfer margin in case of transfer of assets. Thus, in case where there is no preliminary return of transfer margin or final return of transfer margin or no evidentiary document is submitted to prove the actual transaction value, even if the actual transaction value is confirmed, the transfer margin shall be calculated on the basis of the standard market price, and it shall not

Articles 23(4) and 45(1)1 of the former Income Tax Act (amended by Act No. 4281 of Dec. 31, 1990), Article 170(4)3 of the Enforcement Decree of the same Act (amended by Presidential Decree No. 12767 of Aug. 1, 1989)

[Plaintiff-Appellant] Plaintiff 1 and 1 other (Law Firm Domin, Attorneys Park Jae-soo and 1 other, Counsel for plaintiff-appellant-appellant-appellant-appellant-appellant-appellant-Appellee-Appellee-Appellant-Appellee-Appellant-Appellee-Appellee-Appellant-Appellee-Appellant-Appellee-Appellee-Appellant-Appellee-Appellee-Appellant-Appellee-Appellee-Appellant-Appellee-Appellee-Appellant-Appellee-Appellee-Appellant-Appellee-Appellee-Appellee-Appellant-Appellee-Appellee-Appellant-Appellee-Appellee-Appellant-Appellee-Appellee-Appellant-Appellee-Appellee-Appellant-Appellee-Appellee

Plaintiff

Head of tax office

Seoul High Court Decision 92Gu8134 delivered on October 28, 1992

The appeal is dismissed.

The costs of appeal are assessed against the plaintiff.

We examine the grounds of appeal.

According to Articles 23(4) and 45(1)1 of the Income Tax Act, the transfer value and acquisition value, which form the basis for calculating gains on transfer of assets, shall be based on the standard market price, in principle, and only exceptional cases prescribed by the Presidential Decree, shall be based on the actual market price. Article 170(4)3 of the Enforcement Decree of the same Act provides, “Where the transferor can confirm the actual market price at the time of acquisition and transfer by documentary evidence submitted by a declaration of return pursuant to Article 95 (Preliminary Return of Gains on Transfer of Assets) of the Act or Article 100 (Final Return of Tax Base) of the Act,” one of the cases where the actual transaction price is based on the actual transaction price. In the case of transfer of assets, each of the above provisions stipulates that the transfer value has been converted from the existing actual transaction price principle to the standard market price principle in the report of gains on transfer, and thus, if no actual transaction price exists or no documentary evidence certifying the actual transaction price is submitted, the transfer gains shall be calculated based on the standard market price.

According to the reasoning of the judgment below, the court below recognized the fact that the land of this case owned by the plaintiff was transferred to the non-party by the exchange of the land of this case, and judged that the transfer constitutes Article 170 (4) 2 of the Enforcement Decree of the above Act, or there is no evidence to acknowledge that the transfer did not have any income from the transfer, and the plaintiff did not make a preliminary return on the transfer margin or the final return on the tax base, and therefore, the tax disposition of this case, which calculated the transfer margin based on the standard market price, is justified. In light of the records,

Therefore, the appeal is dismissed and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Kim Yong-sung (Presiding Justice)