One house for one household shall be exempted from taxation;

Where a person owns the instant house in Korea and owns two houses additionally acquired after moving abroad, if he/she first disposed of the house additionally acquired, then he/she constitutes a transfer of one house for one household owned by a nonresident in Korea as of the date of transfer.

Article 89 of the Income Tax Act

The appeal is dismissed.

The costs of appeal are assessed against the defendant.

The grounds of appeal are examined.

former Income Tax Act (amended by Act No. 7837, Dec. 31, 2005; hereinafter referred to as the "former Act")

Article 89 subparag. 3 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 18127, Nov. 20, 2003; hereinafter the same shall apply) provides that the period of one house for one household prescribed by the Presidential Decree shall be non-taxable, and Article 154(1) of the former Enforcement Decree of the Income Tax Act concerning such period shall be Article 154 (1) of the same Act provides that the household which consists of a resident and his spouse together with his family members living together with the same address or same place of residence shall have one house in Korea as of the transfer date and the period of one house is three years or more (in case of a house located in Seoul Special Metropolitan City, Metropolitan City, or Si, its retention period is three years or more, and the house is not restricted to the period of one house held in Korea and period of one house which becomes non-taxable under subparagraph 2c of the proviso of the same Article, and Article 154(1) of the former Enforcement Decree of the Income Tax Act provides that if the house is transferred to a nonresident under the former Enforcement Rule of the Housing Act shall be changed.

As determined by the court below, if the Plaintiff, as a resident, owned the instant house in Korea and moved overseas, acquired the instant house and additionally acquired it, and thereafter transferred the instant house after first disposing of it, the court below’s determination that the Plaintiff’s transfer of the instant house constitutes a transfer of one house for one household owned in Korea by a nonresident as of the date of transfer is justifiable, and therefore, there is no error in the misapprehension of legal principles contrary to the principle of no taxation without law or fair taxation, as otherwise alleged in the judgment below.

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 on the bench.