Seoul High Court 2010Nu15270 ( November 10, 2010)

Examination and transfer by the National Tax Service 2009-038

It shall not be deemed that the inherited farmland has been directly and indirectly replaced by co-inheritors.

The term "direct cultivation" which is subject to reduction or exemption of capital gains tax includes the case where a person is employed and cultivated by another person under his responsibility and account, but it is difficult to see that the plaintiff directly cultivated the farmland by employing another person under his responsibility and account.

2010Du26735 Transfer Income Tax and Agricultural Specialized Matters and Revocation of Disposition

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○ Head of tax office

The Seoul High Court Decision 2010Nu15270 decided November 10, 2010

April 14, 2011

The appeal is dismissed.

The costs of appeal are assessed against the Plaintiff.

The grounds of appeal are examined.

According to the reasoning of the judgment below, the court below recognized that Article 66 (12) of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 19329 of Feb. 9, 2006 and amended by Presidential Decree No. 21307 of Feb. 4, 2009, hereinafter referred to as the "former Enforcement Decree") was applied to the reduction or exemption of capital gains tax of the farmland of this case transferred by the plaintiff by inheritance on January 1, 1971 and around 207.

However, Article 23 of the Addenda of the former Enforcement Decree provides that "in applying the amended provisions of Article 66 (12) of the former Enforcement Decree, the former provisions of Article 66 (12) shall apply to the transfer income tax reduction or exemption of the farmland of this case, which was inherited before the enforcement of the former Enforcement Decree, and transferred before December 31, 2008, shall not apply to the transfer income tax reduction or exemption of the farmland of this case, which was transferred before the enforcement of the former Enforcement Decree. Therefore, the judgment of the court below is erroneous in application of the former Enforcement Decree. Meanwhile, the "direct farming" which is the object of capital gains tax reduction or exemption under the former provisions before the enactment of Article 66 (12) of the former Enforcement Decree shall include not only the cases where the transferor cultivates water as well as the cases where he cultivates water by employing another person under his responsibility and calculation (see Supreme Court Decision 94Nu96, Oct. 21, 199).

Therefore, there is no error of law that affected the conclusion of the judgment, and there is no error in the judgment of the court below as to the direct cultivation period of the farmland of this case, and there is no error of law as alleged in the ground of appeal by the plaintiff.

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.