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Title
Whether title trust is held or not
Summary
There is no evidence about the fact that there was no tax avoidance purpose in the nominal trust of shares, and it is legitimate to impose the gift tax by the original title trust.
Related statutes
Donation of title trust property under Article 41-2 of the former Inheritance Tax and Gift Tax Act
Text
1. The plaintiff's claim is dismissed.
2. The costs of lawsuit shall be borne by the Plaintiff.
Purport of claim
The defendant's disposition of imposing gift tax of KRW 96,201,610 against the plaintiff on December 1, 2004 shall be revoked.
Reasons
1. Details of the disposition;
A. On January 27, 2000, 200, Co., Ltd. (the name at the time of incorporation was Co., Ltd., but thereafter changed to the name at the time of December 2, 2002 through Co., Ltd., Co., Ltd., Ltd.; hereinafter referred to as “Co., Ltd.”) was established for the purpose of animal games, amusement and speculation, etc., and the face value of issued stocks was 500 won. Of shares issued at the time of establishment on the register of shareholders, the Plaintiff’s father was 3,390,000 shares and owned 50,000 shares, and the Plaintiff acquired and owned 2,00 shares additionally issued on May 1, 200 and owned 1,742,931,9757 shares and shares each of them acquired and owned by the Plaintiff.
B. The Defendant deemed that the actual owner of the above shares 757,069 shares under the name of the Plaintiff (=50,000 shares + 257,069 shares; hereinafter referred to as “the shares of this case”) was a title trust with the Plaintiff, and that 00 shares were deemed to have been donated to the Plaintiff pursuant to Article 41-2(1) of the Inheritance Tax and Gift Tax Act (amended by Act No. 6780, Dec. 18, 2002; hereinafter the same shall apply). Accordingly, on December 1, 2004, the Defendant issued 378,534,500 won as gift value of the shares of this case (i.e., 500 won X7,069 shares; hereinafter referred to as “the shares of this case”) calculated on May 1, 1998; 200 won as gift tax and gift tax of 3608,708,700,740,707, supra.
[Reasons for Recognition] Facts without dispute, Gap evidence 2, 3 evidence, Eul evidence 1, 2, 4, 7, 8, 10-1 to 3 of evidence 10, the purport of the whole pleadings, and the purport of the whole pleadings
2. Whether the instant disposition is lawful
A. Summary of the parties' assertion
The Defendant asserts that the instant disposition is lawful. The Plaintiff borrowed KRW 250,000,000, which was accepted at the time of the establishment of the 000s, from the bond business operator by force00, and paid KRW 250,000,000,000 on behalf of the Plaintiff to the bond business operator on behalf of the Plaintiff, and the Plaintiff paid the said amount in advance to the bond business operator on behalf of the Plaintiff, and then the Plaintiff paid the said amount in full to the 00,000, with cash withdrawn from February 2, 200 to July 26, 2001. Meanwhile, the Plaintiff paid the said amount in full to the 257,069, which was additionally accepted on May 1, 200, and the Plaintiff paid KRW 128,534,500,000 to the 10,000,000,000,000 under the premise that the Plaintiff was the actual owner of the instant shares.
(b) Related statutes;
Gu Inheritance Tax and Gift Tax Act
Article 41-2 (Presumption of Donation of Title Trust Property)
(1) In case where, notwithstanding Article 14 of the Framework Act on National Taxes, the actual owner and the nominal owner are different in property which requires a registration, etc. for the transfer or exercise of rights (excluding land and buildings; hereafter the same shall apply in this Article), the value of such property shall be deemed to have been donated from the actual owner by the nominal owner on the date when it is registered, etc. as the nominal owner:
1. Where assets are registered, etc. under another person's name without the purpose of tax avoidance;
(2) Where property is registered, etc. in the name of another person and the title of stocks, etc. is not converted to the actual owner during the grace period under paragraph (1) 2, it shall be presumed that there exists a purpose of tax avoidance.
(c) Fact of recognition;
(1) Circumstances such as issuance of the instant shares
(A)The 5,00,000 shares issued on January 26, 200 when the representative director of 000, borrowed from the bond company the amount of KRW 5,500,000 (2,500,000) shares issued on January 26, 2000 and deposited at 00,000 shares and issued a certificate of stock payment custody. On January 27, 2000, after completing the registration of incorporation on January 27, 200, the above bank withdrawn KRW 2,480,000 from the above bank and paid to the bond company. The account book of shareholders included the above amount of KRW 3,390,00 shares out of the above issued shares as provisional payment for the bond company. The register of shareholders acquired each share of KRW 500,000,000 from the Plaintiff and owned each share of KRW 500,000,000 by acquiring each share.
(B) In addition, on April 29, 200, 2000, from 2,500,000 to 3,500,000,000, to 3,500,000,000 capital, borrowed from bond business operators to deposit 1,00,000,000 shares with 00,000 shares and received a certificate of stock payment custody at 00,000 shares, and later, after completing the registration of change of capital on May 1, 200, the above bank deposited 1,00,000,000 won from the above bank and repaid to bond business operators. The above withdrawal also was made to the account books of 000,000 shares as the provisional payment for itself, and the Plaintiff acquired and owned 1,70,000,000 shares in the register of shareholders, and each share is owned by the Plaintiff.
(2)Deposit transactions, etc.
(A) The details such as the withdrawal of cash from February 2, 200 to July 26, 2001 from the Plaintiff’s 00 bank account account are as follows (amount unit: 100 won).
Date
Amount
Jinay
Date
Amount
Jinay
February 2, 2000
25,000
Cash Withdrawal
February 29, 2000
1,000
Cash Withdrawal
10,000
Cash Withdrawal
April 3, 200
3,000
Cash Withdrawal
February 3, 2000
4,000
Cash Withdrawal
April 7, 2000
20,000
Cash Withdrawal
13,000
Cash Withdrawal
April 10, 200
3,000
Cash Withdrawal
February 14, 2000
1,000
Cash Withdrawal
June 14, 2000
12,000
Cash Withdrawal
February 16, 2000
5,000
Cash Withdrawal
July 14, 2000
5,000
Cash Withdrawal
February 17, 2000
4,000
Cash Withdrawal
July 19, 2000
2,500
Cash Withdrawal
3,000
Cash Withdrawal
July 24, 2000
1,400
Cash Withdrawal
25,000
Cash Withdrawal
August 2, 2000
3,500
Cash Withdrawal
February 19, 2000
2,590
Cash Withdrawal
November 14, 2000
9,000
Cash Withdrawal
February 21, 2000
3,200
Cash Withdrawal
December 1, 2000
6,000
Cash Withdrawal
February 23, 2000
10,000
Cash Withdrawal
July 18, 2001
9,000
Account Transfer
(receiving Person):
000 Construction)
February 25, 2000
15,000
Cash Withdrawal
9,000
5,000
Cash Withdrawal
6,000
11,300
Cash Withdrawal
July 26, 2001
23,000
Cash Withdrawal
February 26, 2000
18,000
Cash Withdrawal
Total amount: 268,490
(B) Of the Plaintiff’s above cash withdrawal details, the aforementioned provisional payment and its recognition interest collection details on 14 July 2000 and the corresponding date and amount coincide with each other are not parts of KRW 5,000,000 as of July 14, 200. Meanwhile, there was a provisional payment even for 000 construction, but there was a difference between the Plaintiff’s cash withdrawal details on 13,000 construction and its date and amount on 15,00,000, 25, 18,000,000,000 won as of February 3, 200, and 266, 18,000,000,000 won as of April 30, 200, and the portion other than those on 30,000,000 won.
(C) In addition, from April 29, 200 to April 29, 2000, the Plaintiff deposited KRW 104,834,500 from April 29, 200 to the Plaintiff’s 00 bank account, and the Plaintiff withdrawn KRW 128,534,500 on the same day. Meanwhile, on April 10, 2000, the Plaintiff deposited KRW 100,000 from 00 to the Plaintiff’s 00 bank account under the Plaintiff’s mother’s name, and 30,000,000 out of the above amount was deposited in cash, and the remainder 70,000,000,000 was treated by account transfer.
(3) Plaintiff’s financial capability
(A) Until 2001, the details of the Plaintiff’s earned income and business income (income accrued from the Plaintiff’s operation of a bath called 00 bath) are as follows:
Year
Place of Work
Wage and salary income
Business Income:
1998
00. Business Corporation
26,400,000
73,075,299
199
26,400,000
5,495,847
200
24,000,000
3,165,864
201
Co., Ltd. 00
39,607,008
17,105,840
(B) The Plaintiff did not have the deposit balance as of February 1, 2000 on the deposit account of the above 00 bank.
[Ground of Recognition] A without dispute, Gap evidence 4-1 through 5, 5-1 through 12, 6-3, 4, 8-1 through 6, 9-1 through 9, 12-1 through 6, Eul evidence 2, 3, and 6, the fact inquiry results with respect to 00 points of 00 bank, and the purport of the whole pleadings
[Evidence Evidence] Evidence Nos. 5-1, 10, 11 of A, and testimony of 00 of a witness
D. Determination
(1) According to the facts found above, while establishing or increasing 000s of shares issued including the shares in this case, the amount of 3,500,000,000 won (=2,500,000 +1,000,000,000) was borrowed from the bond company and deposited with the financial institution, and received a certificate of stock payment custody and paid-in to the bond company immediately after completion of each registration. It is recognized that the account book of 0000, in the process, took charge of all the procedures, such as making a withdrawal of the amount and making a repayment to the bond company, and that the amount equivalent to the above shares, which was withdrawn, was disposed of as a provisional payment to the bond company.
(2) Next, we examine the Plaintiff’s assertion.
(A) The Plaintiff asserts that, with respect to KRW 250,000,000 of the shares of this case, the Plaintiff paid 50,000 of the shares of this case to KRW 250,000,000, from the deposit account of the above 00 bank account, the Plaintiff paid 500 of the shares of this case by withdrawing cash over several occasions from February 2, 200 to July 26, 201.
However, as seen earlier, even though the Plaintiff’s aforementioned 00 bank deposit account had been withdrawn in cash amounting to KRW 244,490,000 over several occasions during the above period, there is no objective evidence that the said withdrawn cash was paid to KRW 00 as above. However, it is only identical with the collection details of KRW 5,00,000 for KRW 5,000 for KRW 5,000 for KRW 800. Furthermore, the provisional payment for KRW 600 for KRW 600 is not directly related to the shares price of this case. If the Plaintiff used the above 00 to pay the provisional payment for KRW 24,490,000 for KRW 49,000,000 for KRW 49,000,000 for the above cash withdrawal details, it is difficult to accept the Plaintiff’s assertion that it conforms to the Plaintiff’s payment details for the above 00,000 for KRW 4,000,000 for account transfer.
(B) The Plaintiff asserted to the effect that the sum of 221,490,000 won in cash withdrawn from the above 00 bank deposit account in 2000 was one’s own income or property, and that it was paid to 00 as the price of the above shares. However, the Plaintiff’s balance in the above 00 bank deposit account as of February 1, 200 was not at all, and on the other hand, the Plaintiff’s earned income and business income in 2000 were 57,165,864 won in total (= earned income of 24,00,000 + business income of 33,165,864 won + business income of 24,000 won in total). It is difficult to conclude that the above 221,490,000 won exceeding the above aggregate amount of the above income was the Plaintiff’s own income or assets).
(B) In addition, the Plaintiff borrowed KRW 100,000,000 from 10,000 on April 10, 200 and lent it to 00 on April 29, 200, and the Plaintiff claimed that he paid KRW 100,000 from 128,534,50 out of the shares of this case by paying its own money.
However, as seen earlier, from April 10, 200 to 100,000 won were deposited on the same day, and from April 29, 2000 to 104,834,500 won were deposited on the Plaintiff’s above 00 bank account, and the Plaintiff withdrawn KRW 128,534,500 on the same day from April 29, 200 to 1200 bank account. However, it is difficult to view that the Plaintiff’s money borrowed from 100 to 100,000 won was deposited on the Plaintiff’s deposit account, not on the Plaintiff’s deposit account, but on the other hand, on the Plaintiff’s deposit account with 00,000 won, and that it was difficult to accept the money transferred from 00 to 100,000 won on the basis of general transactional principles, and that the Plaintiff’s money deposited on 100,000 won on the Plaintiff’s deposit account with 200,01000,0000.
(3) In full view of the above circumstances, although the shares of this case are acquired and owned by the Plaintiff in form, its substance is reasonable to deem that it was in title trust to the Plaintiff. Therefore, in the instant case where there is no evidence as to the fact that the strong0 did not have any purpose of tax avoidance in title trust of the shares of this case to the Plaintiff, the Defendant’s disposition of this case premised on the above title trust is legitimate.
3. Conclusion
Thus, the plaintiff's claim of this case is dismissed as it is without merit.