It is difficult to see that the money lent to referring was repaid.

It is difficult to deem that the money of this case was received to exchange the high amount check with a small amount check at the request of the referring rather than a donation from the referring, or that it was received to repay the money to referring.

Article 2 (Gift Tax Taxables) of Inheritance Tax and Gift Tax Act

2018 Gohap1382 Revocation of gift tax

Park AA

○ Head of tax office

May 31, 2019

July 26, 2019

1. The plaintiff's claim is dismissed.

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

The imposition of gift tax of KRW 8,195,040 against the Plaintiff on April 6, 2017 by the Defendant shall be revoked.

1. Details of the disposition;

A. On September 26, 2012, the Plaintiff’s attached BB transferred 1,190 square meters of OOO-dong OOO-dong OOOO-dong OOOO-dong OOO-dong OO-dong OO-dong OO to YangCC at KRW 930,00,00,00 on October 26, 2012, the Defendant calculated the acquisition value of the above forest as KRW 1,281,92,032, and submitted “tax base return and statement of payment for transfer income tax that does not have any transfer income tax upon filing a tax base return at KRW 364,34,232,” and on March 26, 2014, the O-O-dong O-O real estate was transferred at KRW 460,00,000,000 and did not report and pay the transfer income tax to the Defendant.

B. On September 26, 2012, the Defendant, following a tax investigation, corrected and notified 219,466,770 won of capital gains tax on the ground that he/she reported excessive acquisition value on the part of the transfer of real estate by ParkB. On March 2014, the Defendant determined and notified 61,982,660 won of capital gains tax on the ground that he/she did not report the transfer of real estate. However, ParkB did not pay 281,449,420 won of capital gains tax notified as above.

C. On January 25, 2013, the head of △△ Regional Tax Office issued a cashier’s check ( check number, 24,700,000 won to the Plaintiff on January 25, 2013. On November 20, 2014, he confirmed the details of remitting KRW 88,30,000 to the Plaintiff’s account (△△ Bank 1). Accordingly, on August 31, 2015, on August 31, 2015, on the part of the real estate sale price of ParkB’s 113,00,000 won in cash (i.e., check amount of KRW 24,70,000 + account remittance of KRW 88,30,000,000 + “the instant money”) to the Plaintiff, the Plaintiff did not appear to have presented the answer that the Plaintiff received the instant money from ParkB, stating the reasons for and the details of its use.

D. Around December 2015, 2015, the director of the △△ Regional Tax Office notified the Defendant of the assessment data of gift tax on the Plaintiff on the ground that ParkB’s donation of the instant money among the real estate transfer proceeds was confirmed. Accordingly, the Defendant deemed that the instant money was donated from ParkB to the Plaintiff, and decided and notified the Plaintiff of KRW 8,195,040 (including penalty tax in bad faith) on April 6, 2017 (hereinafter “instant disposition”).

E. Accordingly, on July 6, 2017, the Plaintiff concluded a monetary loan agreement with ParkB on the condition that money is lent at the time when money is needed without the agreement with the ParkB, which was put forward by the Plaintiff. Accordingly, on September 23, 2005, the Plaintiff lent KRW 40,000,000 borrowed from DD loans, and KRW 49,670,000, which was borrowed from DD loans on January 2, 2012. Although the instant amount was dismissed on August 28, 2018, the Plaintiff filed an objection with the Tax Tribunal on the condition that it was not a gift since it was paid as a repayment of the said loan from ParkB. However, the Tax Tribunal dismissed the Plaintiff’s appeal on November 22, 2017.

[Ground of recognition] Facts without dispute, Gap evidence 1, Gap evidence 8 through Gap evidence 10, Eul evidence 1 through Eul evidence 8 (including branch numbers), the purport of whole pleadings

2. Judgment on the plaintiff's assertion

A. The plaintiff's assertion

Of the instant money, KRW 24,70,000 was merely exchanged in the name of the ParkB as small amount, and KRW 88,300,000 in cash from May 11, 2001 to June 2, 2008, the Plaintiff lent KRW 146,090,000 to ParkB on 23 occasions in total and KRW 49,670,000 from DD loans and again lent KRW 195,760,000 from January 2, 2012 to ParkB, merely received a repayment of KRW 195,760,000 in total and interest on each of the above loans. Thus, the imposition of gift tax is unjust.

B. Determination

1) Relevant legal principles

A) Generally, in a lawsuit seeking revocation of the disposition imposing tax, the burden of proof as to the facts requiring taxation should be borne by the imposing authority. However, even if there is no direct evidence as to the facts requiring taxation, if it is possible to presume the existence of the facts requiring taxation based on an indirect factual basis that can be reasonably explained in light of the empirical rule, etc. Accordingly, inasmuch as indirect facts can be found in light of the empirical rule in the course of a specific lawsuit, unless the other party to the disposition imposing tax have proved that the facts in question are not subject to the empirical rule or there are special circumstances to exclude the application of such empirical rule in the pertinent case, it cannot be readily concluded that the pertinent tax disposition is an illegal disposition that fails to meet the taxation requirement (see, e.g., Supreme Court Decision 2006Du6383, Sept. 22, 2006).

B) Furthermore, in a lawsuit seeking revocation of the disposition imposing gift tax, insofar as the deposit in the name of the person who is recognized as a donor by the tax authority is revealed to have been withdrawn and deposited in the bank account in the taxpayer’s name, such deposit is presumed to have been donated to the taxpayer. Thus, barring special circumstances, such as withdrawal of such deposit and deposit in the taxpayer’s name, etc. were made for purposes other than donation, the need to prove such fact lies on the taxpayer (see, e.g., Supreme Court Decision 9Du4082, Nov.

2) Specific determination

A) In light of the aforementioned legal principles, it is reasonable to view that the Plaintiff ought to prove special circumstances, such as that the instant money was donated from ParkB to the Plaintiff, on January 25, 2013, and that the Plaintiff received KRW 113,00,000, in total, KRW 88,300,000 from the Plaintiff’s bank account in the name of △△ Bank on November 20, 2014.

B) Comprehensively taking account of the overall purport of the arguments in Gap evidence 2 through Gap evidence 4, Gap evidence 7, Gap evidence 12, Eul evidence 14 (including Serial numbers), and witness testimony part of Song E, the fact that the plaintiff transferred 20,000 won to the bank account (△△△ Bank 2, △△△△ Bank 3), 40,000, 000 won, 20,000 won to the plaintiff on September 23, 2005, 200, 30,000 won, 20,000,000 won from May 11, 2001 to June 2, 2008, 200, 200, 30,000,000 won, 20,000,000 won, 146,000,000,000 won, 30,000,000 won, 20,000.

C) However, in light of the following circumstances that can be seen by comprehensively considering the aforementioned evidence and witness testimony of the EE, the Plaintiff did not receive the instant money from ParkBB, but merely received the money from the Plaintiff at the request of ParkBB, for exchange of the money as a small check, or it is difficult to view that the Plaintiff received the money from the Plaintiff to return it to ParkB, and there is no other evidence to acknowledge otherwise. Accordingly, the Plaintiff’s assertion is without merit.

(1) From March 10, 1989 to June 29, 2001, the Plaintiff’s attached ParkB appears to have operated the Plaintiff’s business registration under the name of the Plaintiff after closing the business registration on June 29, 2001, and the Plaintiff appears to have operated Habb from July 1, 2001. In addition, ParkB was elected as a member of the Organization Council and served as the chairman of the Organization Council, etc., and it seems to have significant re-existent by holding many real estate including real estate subject to capital gains tax as seen earlier. On the contrary, the Plaintiff’s assertion that the annual revenue reported to the tax office from 2001 to 2008 from 200 to 200 to 2008, including the minimum annual revenue amount of KRW 88,780,000 to 20 to 20 to 300 to 20 to 200 to 300 to 407 to 200 to 200 to 7 to 200 to .

(2) Although the Plaintiff’s assertion is possible to enter into a monetary loan agreement or a loan agreement with respect to a monetary transaction between the sub-subsidiarys without preparing a monetary loan agreement or a loan certificate, there is no evidence to deem that the Plaintiff lent the money to ParkB except for the above remittances. Moreover, the Plaintiff asserts that the instant money received from ParkB from ParkB was partially repaid the principal and interest of the loan, but there is no specific assertion as to which content the interest agreement was made, and how the repayment period was made. In addition, there is no evidence to support this.

(3) The loan period of KRW 146,090,00, which the Plaintiff claimed from ParkB to 23 times, was from May 11, 2001 to June 2, 2008. On the other hand, the Plaintiff’s receipt of the instant money from ParkB from the Plaintiff was made on January 25, 2013 and November 20, 2014, after ParkB transferred its own real property, there was an interval of 4 to 13 years. If the said money was a loan as alleged by the Plaintiff, even if there was no father-child relationship with the above money, it is not common that the Plaintiff did not pay the interest or principal during the above period, and how the Plaintiff did not specifically explain how the Plaintiff paid the principal and interest to the Plaintiff’s loan by asserting that the instant money was repaid to the Plaintiff.

(4) On January 2, 2012, the Plaintiff asserted that DB borrowed KRW 49,670,00 from DB and lent it to the said BB. However, EE, which was operated by the said lending company, was lent money at the request of ParkB, which was known to the president of the ○○ Council and was offered to the Plaintiff at the request of the said lending company to lend KRW 50,000,000,00. At the time, LB made a written loan agreement and made money to the Plaintiff, which was only made by LB, to the Plaintiff, and the Plaintiff appears to have prepared a written loan agreement in the name of the Plaintiff in the name of LB and received a check from EB, and deposited it into the account of LBB. However, it is difficult to accept the Plaintiff’s assertion that the Plaintiff lent money to the said lending company by borrowing money from the said lending company.

(5) Ultimately, the Plaintiff asserted in the instant case by deeming all financial transactions remitted or remitted through an account for a long time between the ParkB, but it is difficult to accept it immediately in light of the aforementioned various circumstances. Rather, it is reasonable to view that it is natural for a long time between the Plaintiff and the ParkB, as seen earlier, under the name of a small living expense between the Plaintiff and the family members, for a long time.

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit. It is so decided as per Disposition.