National High Court 2005 Jeon1277 (Law No. 23, 2005)
Farmland cultivated for feed pots also has been subject to reduction or exemption of capital gains tax for self-Cultivating farmland for at least eight years.
Article 114 of the Income Tax Act (Determination, Revision and Notice of Tax Base for Transfer Income and Amount of Tax) / Enforcement Decree of the Income Tax Act / Scope, etc. of farmland
The early 2010 Before 648
The imposition of capital gains tax amounting to KRW 97,403,720 on March 11, 2005 by the head of the OO head of the tax office shall be deemed to have been 1,586 square meters, excluding KRW 871 square meters for OOOOOOOOOOOOOO's farmland located within 2,457 square meters transferred by the claimant, and the amount of capital gains tax and tax shall be deemed to have been 8 years old farmland, and shall be corrected accordingly.
1. Summary of disposition;
A. The claimant acquired on December 24, 1969 OOOOO (hereinafter “OO”) 251-5, 251-9, 48 square meters prior to 251-9, 251-10, 532 square meters prior to 251-10, 251-11, 251-17, 250-31 square meters prior to 250-313 square meters prior to 204.4.22, 251-6, 250-4, 305 square meters prior to 250-4, and 251-13, and 358 square meters prior to 204.3 years prior to the transfer of farmland by the claimant, he/she applied for reduction of or exemption from the farmland (hereinafter referred to as “the farmland”), while living for 208 years or more pursuant to the provisions of Article 97 of the Restriction of Special Taxation Act.
(b)The Administration made a notification of correction of KRW 97,403,720 to the claimant on March 11, 2005, of the transfer income tax for the year 2004, that the farmland transferred by the claimant is not considered as farmland for eight years.
C. The appellant appealed and filed an appeal on March 3, 2005.
2. Opinions of the claimant and disposition agency;
A. The claimant's assertion
Whether land falls under the previous and previous category of land subject to agricultural income tax or farmland tax shall be determined by objectively assessing and determining the long-term purpose of use of the land as well as the location, form, etc. suitable therefor, and it shall not be considered that it is difficult to find out the temporary use relationship (OOO, September 10, 1985), Article 69 of the Special Purpose Act and Article 197 of the Local Tax Act stipulate that land subject to agricultural income tax is an income accruing from the cultivation of crops among agriculture in the Korean Standard Industrial Classification Table under Article 17 of the Statistics Act, and any other historical crops, such as mama, ma, etc. cultivated by OO on the controversial issue of farmland falls under the Korea Standard Industrial Classification Table and other crop cultivation business (01140). The taxation disposition by the disposition agency imposing the transfer income tax is unjust solely on the fact that the farmland is temporarily cultivated, such as maok, giving or receiving, etc. in a state in which the form of farmland is not changed.
(b)Opinion of the Administration;
Although the claimant asserts that the period of growing feed crops is temporary, the tenant has been continuously cultivated for 4 years immediately before the transfer, even if the photograph taken on November 2, 2004, it is confirmed that the tenant has been growing for 4 years immediately before the transfer, and if the claimant did not transfer the disputed farmland, it is not reasonable to argue that the tenant would have continuously cultivated the crops and that the tenant would have temporarily cultivated the crops, and in addition, when considering the "Land Transaction Permit" which was submitted at the time of receipt of the original report of capital gains tax, the OOOOOOOO of the disputed farmland is the land category, and therefore, the original tax disposition is justifiable, as it is not farmland at the time of transfer.
3. Hearing and determination
Whether the disposition to exclude the reduction or exemption of capital gains tax by the self-sufficiency of eight years is legitimate by deeming the farmland transferred by the claimant as land for stock farm and site for stock farm;
(b) Related statutes;
(i) Income Tax;
Article 114 【Determination, Revision and Notification of Tax Base for Transfer Income and Amount of Tax】
(2) If any omission or error is found in the details reported by a person who has made a preliminary return under Article 105 or a person who has made a final return under Article 110, the chief of the regional tax office having jurisdiction over the place of tax payment shall correct
2) Article 70 of the Enforcement Rule of the Income Tax Act 【Scope of Farmland”
(1) The term "farmland" in Article 153 (1) and (2) of the Decree means the full answer, which is the land actually used for cultivation regardless of the land category on the public cadastral book, and includes the farmland management, such as composts, composts, pumping stations, swamps, branch roads, etc. which are directly required
3) Article 69 of the Restriction of Special Taxation Act 【Exemption of Transfer Income Tax, etc. on Self-Cultivating Farmland】
(1) With respect to any income accruing from a transfer of land prescribed by the Presidential Decree, which is directly cultivated by a person falling under any of the following subparagraphs for not less than eight years and is subject to the farmland tax (including the land subject to non-taxation, reduction and exemption, and small collection):
1. A person who resides in the seat of a farmland under the conditions as prescribed by the Presidential Decree; and
2. Corporations or agricultural partnership corporations prescribed by the Presidential Decree, engaged in agricultural production as their main business (amended by December 28, 1998).
(4) Article 66 of the Enforcement Decree of the Restriction of Special Taxation Act (Exemption from capital gains tax, etc. for arable farmland)
(1) The term "land prescribed by the Presidential Decree" in the main sentence of Article 69 (1) of the Act means the farmland that a decedent has cultivated for not less than eight years between the time of acquisition and the time of transfer, excluding that falling under any of the following subparagraphs. In this case, in calculating the period of farmland cultivated, the period acquired and cultivated by a decedent shall be deemed the period during which the heir cultivates such farmland (amended by December 31, 1998):
1. Farmland located in the Special Metropolitan City (excluding Guns located in Metropolitan Cities) or Si (excluding Eup/Myeon areas in the city of the urban complex form, which is established under Article 3 (4) of the Local Autonomy Act) as of the transfer date, for which three years have passed since the date of incorporation into the residential area and industrial area under the Urban Planning Act, among the farmland located in the Special Metropolitan City (excluding Guns located in Metropolitan Cities) or Si (excluding Eup/Myeon areas in the city of the urban complex form, which are established under Article 3 (4) of the Local Autonomy Act): Provided, That the farmland incorporated into the residential area, commercial area or industrial area under the Urban Planning Act, as a result of the implementation of the large-scale development project in the area of the project falling under any of the following items, and for which three years have passed since the date of incorporation into the said area, by phase or delay, shall be excluded:
2. Where any land, other than the farmland, has been designated prior to the date of a replotting disposition, the farmland for which three years have elapsed from the date of such designation (the date of December 31, 1998).
(2) Farmland subject to the provisions of paragraph (1) shall be based on farmland as of the date of transfer under the provisions of Article 162 of the Enforcement Decree of the Income Tax Act: Provided, That where a purchaser changes the form and quality and starts construction in accordance with the terms and conditions of a sales contract before the date of transfer, farmland as of the date of a sales contract shall be based
(4) For the purpose of Article 69 (1) 1 of the Act, the term “resident residing in the seat of a farmland” means a person who has cultivated for not less than eight years while residing in the area falling under any of the following subparagraphs (amended on December 31, 1998):
4) Local Tax Act (Law No. 6312, Dec. 29, 2000)
Article 197 (Definitions)
The term "agricultural income" in this Section means income accruing from growing such crops as prescribed by Presidential Decree (hereafter referred to as "crops" in this Section) among the agricultural activities under the Korean Standard Industrial Classification that is prepared and announced by the Commissioner of National Statistical Office.
Article 198 (Person Liable for Tax Payment)
(1) A person having agricultural income shall pay the agricultural income tax to the Si/Gun having jurisdiction over the place where the farmland is cultivated.
Article 1 of Addenda
This Act shall enter into force on January 1, 2001.
Article 11 of Addenda (Relation with Other Acts)
(1) The following shall be amended in the Restriction of Special Taxation Act:
The farmland tax in the main sentence of Article 69 (1) shall be the agricultural income tax.
(5) Enforcement Decree of Local Tax Act
Article 147 (Scope of Agriculture)
The term “crops as prescribed by the Presidential Decree” in Article 197 of the Act means the crops belonging to the classification of crop cultivating business (limited to rice in case of crops classified as belonging to the grain and other crop cultivating business).
◆ 한국표준산업분류표상의 분류
◦코드 01 : 농업(중분류)
◦코드 011 : 작물재배업(소분류)
◦코드 0114 : 기타작물재배업(세분류)
◦코드 01140 : 기타작물재배업(세세분류)
◆한국표준산업분류표상의 기타 작물 재배업(01140)
It refers to the growing of medicinal crops, feed crops, crops for oil extraction, crops for industrial raw materials, etc., which are not otherwise classified in the street land.
C. Facts and determination
1) The disposition agency claims that the disposal agency's initial disposition that did not apply capital gains tax reduction or exemption for 8 years as farmland is justifiable since it cultivated feed crops that were used as a site at the time of the transfer on June 12, 2004, and that the disposal agency's original disposition that did not apply capital gains tax reduction or exemption for 1,586 square meters prior to the date of transfer on June 13, 2004 among the key farmland belongs to a temporary and other crop cultivation business under the Korean Standard Industrial Classification Table because the form of farmland for 8 years is not changed, and the applicant claims that this farmland belongs to farmland because it belongs to a temporary and other crop cultivation business under the Korean Standard Industrial Classification Table. The applicant for confirmation of the cultivation, the applicant for confirmation, and the tenant KimO and the key issue farmland lease farmland prepared by three residents living in the location of the farmland, and presented a pledge and a land cadastre prepared on November 13, 200, as well as an OOOOOOOOO.
2) There is no dispute between the claimant and the disposition authority as to the fact that the claimant for the instant farmland was self-fluored for not less than eight years and that the 1,586 square meters of the farmland was continuously cultivated by the lessee KimO for four consecutive years immediately before the date of transfer.
3) However, the claimant presented the certificate of cultivation prepared by three village residents living in the dominant farmland located at the time of the transfer, and the land cadastre of the OOOOOOO on August 18, 2004, after the date of transfer, the land category was changed from the whole to the site. However, the claimant received the land transaction application at the time of OO on May 24, 2004, which was before the date of the transfer of the key farmland, and the land registration certificate issued by the OOOOOO was previously stated in the land transaction contract certificate issued by the OO market as of June 10, 204, but the actual site was stated as the land site, and there is no evidence to support this. Thus, it is determined that OOOO was a farmland at the time of transfer, not the farmland at the time of the transfer.
4) Since 1,586 square meters prior to the instant farmland other than OOOOO were cultivated at the time of transfer, the disposition agency claims that it is not farmland, but farmland. However, in Article 69 of the Special Act on the Control of Land, Article 69 provides that the requirements for reduction and exemption for 8 years or longer should be the land subject to the farmland tax, which has been cultivated directly for 8 years or longer, and the farmland tax is taxed on agricultural income under the Local Tax Act, and the agricultural income tax is defined in Article 197 of the Local Tax Act as the income derived from the cultivation of crops under the Korean Standard Industrial Classification Table. Since historical crop cultivation is classified as farmland tax, the land where the business entity conducts the cultivation of feedhouse is also subject to the farmland tax. Accordingly, it is determined that the disposition agency considers the farmland at issue, excluding OOOOOO 871 square meters, among the farmland, as the land for stock farms for eight years or more, and thus, it is determined that the transfer income tax has not been applied by misunderstanding legal principles.
This case's request for a trial is a part of the claimant's assertion as a result of the trial, and it is decided as ordered in accordance with Articles 81 and 65(1)3 of the Framework Act on National Taxes.