Examination-transfer-2015-0163 ( December 30, 2015)

If a minor without parents is combined with his/her grandparent on the basis of his/her resident registration, the minor shall not be deemed a sole household.

In a case where a plaintiff who is a minor of the Commission becomes two houses for one household by combining his/her parents with his/her grandparents, the provisions of non-taxation on one house for one household cannot be applied by deeming the minor as a separate one household on the grounds of the restriction on the composition of a household under the Resident Registration Act.

Article 89 of the Income Tax Act

Incheon District Court 2016Gudan251 Revocation of capital gains tax

EO

OO Head of the tax office

208.23

oly 11, 2016

1. The plaintiff's claim is dismissed.

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

Cheong-gu Office

The Defendant’s disposition of imposition of capital gains tax of KRW 3,360,180 for the Plaintiff on August 1, 2015 shall be revoked.

1. Details of the disposition;

A. On July 5, 2010, the Plaintiff’s fathero and the mother Kimo died at the same time as a traffic accident, and the Plaintiff and his her dong 00,000 Dong-dong 00,000 Dong-dong 00, 91300 Dong-dong 00 (hereinafter “the apartment of this case”), each of 1/2 shares of 00 Dong-dong 00,000 Dong-dong 00 (hereinafter “the apartment of this case”).

B. On September 27, 2010, the Plaintiff and Lee Young-young transferred their resident registration to a household of the △△△ Division, and transferred the instant apartment to KRW 55,00,000 on June 30, 2014, and subsequently reported the transfer income tax on August 29, 2014, deeming that the instant apartment constitutes one house for one household and is exempt from taxation.

C. On August 1, 2015, the Defendant: (a) deemed that two bonds owned by grandparents are more than one house-free requirement at the time of the transfer of the instant apartment; and (b) determined and notified capital gains tax of KRW 3,360,180 to the Plaintiff in 2014 (hereinafter “instant disposition”).

D. The Plaintiff filed a request for examination with the Commissioner of the National Tax Service via an objection, but was dismissed on December 30, 2015.

Facts without any dispute, Gap's evidence 1 through 3, Eul's evidence 1 to 6, the whole purport of the pleading, and the whole purport of the pleading.

2. Whether the disposition is lawful;

A. The plaintiff's assertion

The Plaintiff, a minor without a livelihood, was unable to form a separate household, and thus, was bound to move his resident registration to a grandparent who is a lineal ascendant, and became joint with the Plaintiff. As such, the Plaintiff’s legal restriction is not possible to make a single household, and thus, the special provisions on non-taxation of one house for one household should be applied to the Plaintiff’s grandparents. However, the instant disposition based on a different premise is unlawful.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

(1) Under the principle of no taxation without law, the interpretation of tax laws and regulations shall be interpreted in accordance with the text of the law, barring special circumstances, and shall not be extensively interpreted or analogically interpreted without reasonable grounds. In particular, it accords with the principle of equity in taxation to strictly interpret that the provision of tax reduction and exemption is clearly preferential (see, e.g., Supreme Court Decision 2008Du11372, Oct. 20, 2009).

(2) With respect to this case, Article 89 (1) 3 (a) of the Income Tax Act provides that "one house for one household prescribed by Presidential Decree shall not be imposed on income generated from the transfer of "one house for one household". Article 154 (1) of the Enforcement Decree of the same Act provides that "one house for one household prescribed by Presidential Decree" shall mean that "one household comprised of the resident and his spouse together with the family members living together with the same address or same place of residence shall have one house in Korea as of the date of transfer, and the period of holding two years or more". Paragraph (6) of the same Article provides that "family members" shall be "one lineal ascendant or descendant (including their spouse) and sibling of the resident and their spouse shall not be deemed to have a separate house for five years or more", while Article 89 (1) 3 (a) of the same Act provides that "one house for one household shall be deemed to have a separate house for five years or more from the date on which the plaintiff's share of the apartment house and his spouse shall not be interpreted as one house for five years or more."

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed, and it is so decided as per Disposition.