2013 Superintendent of the Supreme Court 014

Whether farmland incorporated in a residential area for eight years or more can be viewed as self-farmland, and whether it is subject to special long-term holding deduction because it falls under the land for business.

Even if there is no proof of self-defense, it shall be excluded from farmland for which three years have elapsed since the date of incorporation into the residential, commercial and industrial areas, as farmland located within the residential, commercial and industrial areas, and there is no evidence to prove otherwise as to the self-defense, but it is not subject to the special long-term holding deduction because there is no evidence to prove otherwise as to the self-defense.

Article 69(1) of the Restriction of Special Taxation Act, Article 66(13) of the Enforcement Decree of the Restriction of Special Taxation Act

2013Guhap21050 Revocation of Disposition of Imposing capital gains tax

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K Director of the Korean Tax Office

May 13, 2014

June 3, 2014

1. The plaintiff's claim is dismissed.

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

Cheong-gu Office

The Defendant’s disposition of imposition of capital gains tax OOO on October 1, 2012 is revoked.

1. Details of the disposition;

"A. On March 2, 1990, the Plaintiff acquired 1/2 shares of 00 of 20 OO2, O277-17, 353 square meters prior to O2, O2, 2003. On January 22, 2003, the Plaintiff was 407 square meters prior to 194 square meters of the above land (hereinafter referred to as "the instant land") on the registry on April 10, 2012. The Plaintiff sold the instant land to 20,000,000,000,000,000,000,0000,000,000,000,000,000,0000,000,000,000,000,000,000,000,000,000,000,000,000,000).

". The defendant, on October 1, 2012, decided and notified OOO (including additional OOO) of capital gains tax for the year 2012 to the plaintiff (hereinafter "the disposition in this case") and filed a petition for review with the Board of Audit and Inspection against the disposition in this case, but the petition for review was dismissed on July 25, 2013." There was no dispute with recognition, Gap evidence 1, 2, Eul evidence 3-1, 2, Eul evidence 1, 2, Eul evidence 3-1, 1, 2, 2, 1, 2, and 3, and the purport of the whole pleadings, all of the arguments, and the purport of the whole arguments.

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The instant disposition shall be revoked on the grounds that it is unlawful for the following reasons.

"1) During the process of acquiring the instant land and forming a farming city, the Plaintiff leased 202 m2 m2 (hereinafter “the instant land”) from April 29, 201 to December 14, 201 due to the construction of a newly-built multi-family house in the vicinity of the instant land to restore the said land to its original state after completing the said construction. Therefore, since the Plaintiff’s land was owned for at least eight years, the Defendant did not apply the said reduction or exemption provision even if the Plaintiff had to reduce capital gains tax pursuant to Article 69(1) of the Restriction of Special Taxation Act. (2) The Plaintiff leased the instant land to the neighboring m205 m205 m205 m2 (hereinafter “the instant land”). From October 23, 2008 to December 14, 2011, the Defendant owned the instant land for the remainder of the period from March 21, 2002 to December 23, 2012.

As shown in the attached Form.

C. Determination

1) Determination as to whether land No. 1 of this case was self-arable for at least eight years

A) According to Article 69(1) of the Restriction of Special Taxation Act and Article 66(13) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 24368, Feb. 15, 2013; hereinafter the same) of the same Act, a person who resides in the farmland in order to be eligible for the reduction or exemption of capital gains tax due to farmland conservation is engaging in the cultivation of crops or perennial plants on his/her own farmland or growing or growing or growing or growing at least half of farming works with his/her own labor. The burden of proof for the requirements for reduction or exemption of capital gains tax lies on a person liable to pay tax exemption (see, e.g., Supreme Court Decision 2002Du7074, Nov. 22, 2002)

B) We examine whether the Plaintiff’s land No. 1 in the instant case was self-defensed for at least eight years.

As shown in the Plaintiff’s assertion, each testimony of Gap evidence 7 (a certificate of actual cultivation), witness DD, and KimE is difficult to believe it as it is in light of the relationship with the person who made the statement and the opposing circumstances as below, and it is insufficient to recognize that Gap evidence 5 (a certificate of partner), Gap evidence 13-1 through 9, and Gap evidence 14 (the farmland ledger), and Gap evidence 10-1 through 4 are sufficient to recognize that the plaintiff has cut down the land of this case for not less than 8 years, and there is no other evidence to acknowledge it otherwise.

Rather, comprehensively taking account of the overall purport of arguments in Gap evidence 2, Eul evidence 2, Eul evidence 3, Eul evidence 5 (Notice of Land Information Data) and Eul evidence 6 video, it is difficult to see that the plaintiff used the land of this case as farmland of this case at the time of transfer for 8 years or longer, even if the plaintiff used the land of this case as farmland of this case for 1 years or more from 2004 to 201, the land of this case is "the current state or place of land from 2004 to 2011," and the plaintiff's land of this case at the time of transfer in the pre-assessment review procedure was not presumed to have been old (see Supreme Court Decision 94Nu996, Oct. 21, 194).

According to Article 69(1) of the Restriction of Special Taxation Act and Article 66(4) and (5) of the Enforcement Decree of the same Act, farmland eligible for reduction of or exemption from capital gains tax refers to farmland cultivated by itself for not less than eight years from the time of its acquisition until the time of its transfer, and excluding farmland for which three years have passed from the date of incorporation into a residential, commercial and industrial area under the National Land Planning and Utilization Act (hereinafter referred to as the National Land Planning Act), among farmland in Si as of the date of its transfer, and farmland for which three years have passed from the date of its incorporation into such area under the National Land Planning and Utilization Act (hereinafter referred to as the "National Land Planning Act"), and evidence No. 3-1, No. 2, No. 6, and No. 2, the whole purport of pleadings in the statement of No. 1, land was located in Changwon-si as of the date of its transfer, and land No. 1 was incorporated into a residential area as of July 21, 1986.

D) Therefore, the Plaintiff’s above assertion is without merit.

2) Determination as to whether the land No. 2 of this case was subject to special deduction for long-term possession

(1) Article 95(1) and (2) of the former Income Tax Act (amended by Act No. 11611, Jan. 1, 2013; hereinafter referred to as the "Income Tax Act") provides that the special deduction system for long-term holding shall deduct a certain rate according to the transfer margin of the land or building with a holding period of at least three years from the date of the transfer thereof, and that the farmland shall constitute the land for business purposes in order to be subject to special deduction for long-term holding in order to obtain such special deduction for transfer income tax if it is transferred, and to be subject to such special deduction for long-term holding in order to obtain such deduction for transfer income tax from the transfer thereof.

B) As seen earlier, the Plaintiff itself recognizes that the land No. 2 of the instant case was leased to the ChoCC from October 23, 2008 to the date of transfer, and thus, the Plaintiff did not do so during that period. Therefore, the instant land No. 2 does not constitute a requirement of mutual aid premised on the premise that it was for three or more years, or for two or more years, out of five or more years immediately before the transfer date, among the requirements for special deduction for long-term possession.

However, the Plaintiff’s claim for special deduction for long-term holding based on the premise that the Plaintiff owned the instant land No. 2 for more than 80% of the rental period, but it is not sufficient to acknowledge the Plaintiff’s above assertion solely on the following images: evidence No. 5, evidence No. 13-1 through 9, evidence No. 14, and evidence No. 10-1 through No. 4, and there is no other evidence to acknowledge it.

C) Therefore, since the instant land No. 2 does not fall under the land for business, the instant disposition that did not obtain the special deduction for long-term possession is lawful, and the Plaintiff’s assertion on a different premise is without merit.

3. Conclusion

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