Penalty received by termination of a contract shall be paid for breach of contract after cancellation of contract.

Since the contract for sale in lots was cancelled and the penalty was paid, the penalty shall not be deemed as the penalty for the cancellation of the contract for sale in lots, and it shall not be deemed as the penalty for delay in moving into the house, and the statutory interest on the original payment shall be included in the range of restitution under Article 548 of the Civil Act. Therefore, it is difficult to view it as

2014Guhap72071 global income and revocation of such disposition

arA et al. 14

D Head of the tax office and 32

December 20, 2016

on October 10, 2017

1. The part of the disposition imposing global income tax imposed by the Defendants against the Plaintiffs, such as the details of the disposition imposing global income tax, which exceeds the tax amount indicated in the separate sheet of global income tax.

2. The plaintiffs' remaining claims are dismissed.

3. One-half of the costs of lawsuit are assessed against the Plaintiffs, and the remainder is assessed against the Defendants.

Cheong-gu Office

The disposition of global income tax imposed by the Defendants against the Plaintiffs shall be revoked as shown in the attached Form.

1. Details of the disposition;

From January 17, 2007 to December 22, 2007, the plaintiffs entered into a sales contract with AA Construction Co., Ltd. (hereinafter referred to as "A Construction") and AA Construction to newly construct the apartment at BB (hereinafter referred to as "the apartment of this case"), and paid part of the sales price including the down payment.

On the other hand, the plaintiffs and AA Construction made it impossible to move into within three months from the scheduled occupancy date, and the contract is terminated, the AA Construction shall pay to the plaintiffs 10% of the total purchase price as penalty. <2> If the parties fail to move into the scheduled occupancy date, the compensation for delay (15% per annum or 19% per annum according to the delayed period) shall be paid.

The plaintiffs filed a lawsuit against A on May 7, 2009 to seek the return of the sale price (A Construction failed to complete the apartment even before July 2009, which was three months from the scheduled date of occupancy, and the contract for sale in lots was rescinded on July 2009, while the lawsuit was pending) and AA Construction received dividends from the plaintiffs in the auction procedure of this case (Seoul District Court Decision 2009Ga51740) on September 7, 2010 (Seoul High Court Decision 201Na18319). The plaintiffs received dividends from the auction procedure of this case on December 9, 2012 (Seoul High Court Decision 2010Na18319).

The Plaintiffs did not report dividends corresponding to the penalty of this case as income or considered 80% of the liquidated damages for delayed moving into a house among other income under the Income Tax Act, and reported and paid income tax by deducting 80% as necessary expenses.

The defendants included the penalty of this case in other income, legal interest, etc., and denied the deduction of necessary expenses for the penalty of this case as well as the deduction of necessary expenses for the penalty of this case, and notified the plaintiffs of the determination, correction, and notification of comprehensive income tax (However, since some arguments were accepted by the Tax Tribunal, such as the lawyer's fee deduction and the time of attribution of the amount of tax, and thus the correction was made, the disposition on the remaining tax amount after the reduction was made "the disposition of this case").

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1 through 7, Eul evidence Nos. 1 through 166 (including paper numbers, hereinafter the same shall apply), the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. Whether the penalty of this case constitutes "other income"

According to Article 21(1)10 of the former Income Tax Act (amended by Act No. 11611, Jan. 1, 2013; hereinafter the same) and Article 41(7) of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 24315, Jan. 16, 2013; hereinafter the same) (amended by Presidential Decree No. 24315, Jan. 16, 2013; hereinafter the same), penalty or compensation equivalent to other income is the compensation for damages exceeding the damages per se to the payment itself that forms the original contract’s terms and conditions, regardless of its title or pretext. Here, the term “money compensation for damages exceeding the damages per se” refers to cases where the damages exceed its own preservation and thereby, the increase in net assets is caused.

As seen earlier, the Plaintiffs received not only the sale price already paid from AA Construction and its statutory interest and delay damages, but also the penalty of this case as a penalty for breach of contract cancellation. If the sale contract has not been rescinded, the Plaintiffs were to purchase the apartment of this case and refund the sale price for the purchase in lots (including legal interest and delay damages) due to the cancellation of the sale contract for the term in which the remainder was paid, and the penalty of this case was additionally paid. As such, the penalty of this case constitutes other income as compensation for damages exceeding the payment itself, which is the contents of the original contract, and constitutes other income.

B. Whether the penalty of this case constitutes "compensation for delay in moving into the house"

According to Articles 21(1)10 and 37(2)2 of the Income Tax Act, and Article 87 subparag. 1(c) of the Enforcement Decree of the same Act, 80% of the amount received for liquidated damages for moving into the house and the amount actually spent in excess of the amount received may be included in necessary expenses, from among penalty and damages received due to a breach or cancellation of a contract.

However, as seen earlier, the Plaintiffs asserted that, if the contract is terminated because it is impossible to move into within 3 months from the scheduled date of occupancy, 10% of the total amount of the sale price shall be paid as penalty, or if the contract is terminated, 10% of the total amount of the sale price shall be paid as compensation for delay. Since the Plaintiffs cancelled the sale contract and received the penalty in this case, the penalty in this case is a penalty for delay due to cancellation of the contract, and it is not a penalty for delay due to delay of occupancy, and it is difficult to view that the penalty in this case constitutes "compensation for delay in moving into a house" (in terms of the purport of the income tax law or the tax policy aspect, it is difficult to view that the damages arising until the time when the buyer can exercise the right to cancel by exercising the right to cancel are more identical in nature, and therefore, the penalty in this case shall be included as "compensation for delay in moving into a house" in the Enforcement Decree of the Income Tax Act. However, in this case, the penalty for delay shall be included in the total amount of 10%, but shall not be different from the penalty for delay in accordance with overdue interest rate.

C. Whether the legal interest of this case constitutes "other income"

As seen earlier, penalty or compensation under Article 21 (1) 10 of the former Income Tax Act is the compensation for damages received due to a breach or termination of a contract on the property right, and refers to the compensation for damages exceeding the damages to the payment itself which forms the contents of the original contract, regardless of the pretext or pretext.

However, given that statutory interest, etc. in this case is added to the price to be returned to the other party according to the contract cancellation, it is difficult to view it as losses exceeding the damages to the payment itself, which is the contents of the original contract, since it is included in the scope of restitution by the other party (Article 548 of the Civil Act). In addition, among the statutory interest in this case, 5% amount per annum under the Civil Act, which is added to the sale price after the cancellation of the contract became effective (after the plaintiff filed a lawsuit claiming the return of the sale price, and the plaintiff expressed his intention of rescission on July 2009) shall be added to the sale price (in addition, where there is any cause attributable to the cancellation), as well as the nature of the damages caused by the delay of the contract as restitution (in addition, where there is any cause attributable to the cancellation), it is difficult to view that it can be imposed as other income by separating only the above 5% amount from the amount by the ratio of 20% per annum under the Act on Special Cases Concerning the Promotion, etc. of Legal Proceedings, which exceeds the above 5%).

Meanwhile, Article 21(1)10 of the Income Tax Act (amended by Act No. 12852, Dec. 23, 2014) provides, unlike the former Income Tax Act, that the amount of penalty, compensation, and the interest paid at the time of return of unjust enrichment thickness among the income received due to a breach or termination of a contract, shall be deemed other income. Therefore, it is difficult to deem that the statutory interest, etc. accrued prior to such amendment as a matter of course is included in other income. Therefore, the part on which the instant statutory interest, etc.

D. Whether the imposition of additional tax is illegal

According to Article 48(1) of the Framework Act on National Taxes, where a taxpayer has justifiable grounds for failing to perform his/her duties, penalty taxes shall not be imposed. Here, justifiable grounds refer to cases where the taxpayer is not negligent in neglecting his/her duties.

However, Article 21 (1) 10 of the Income Tax Act provides that "the penalty or compensation received due to a breach or termination of a contract shall be one of other income, and Article 87 (1) 1 (c) of the Enforcement Decree of the same Act provides that "the penalty or compensation that is deductible as necessary expenses shall be paid" for the penalty or compensation that is deductible as "the compensation for delay in moving into a house". In the event of cancellation of the contract, the plaintiffs entered into a sales contract separately from the penalty or compensation for delay payable if delayed moving into a house, and even the judgment of a civil case seeking the return of the

In full view of these circumstances, it is difficult to view that the Plaintiffs’ assessment of the penalty in this case as liquidated damages for delayed moving into the housing and the amount of 80% of the revenue amount is deducted from the necessary expenses and the comprehensive income tax is reported and taxed.

(e) Calculation of justifiable taxes;

The amount of a political party tax calculated by excluding the statutory interest, etc. in this case from the tax base is as indicated in the “total amount of tax calculated” column, and the portion exceeding the legitimate amount of tax in the disposition in this case is unlawful.

3. Conclusion

Therefore, the plaintiffs' claim of this case is accepted within the scope of the above recognition, and the remaining claims are dismissed as they are without merit.