Cho High Court Decision 2009Du3888 ( December 31, 2009)

Reduction of or exemption from capital gains tax for self-farmland for 8 years;

It is difficult to see that the Plaintiff’s wife had operated a kindergarten, a considerable distance to farmland, and a part which is confirmed to have been cultivated by an airline train, etc. is extremely part of the area, and thus, directly scam.

The contents of the decision shall be the same as attached.

Ma-○

The head of Yangcheon Tax Office

1. The plaintiff's claim is dismissed.

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

The defendant's refusal to reduce or correct the transfer income tax for the year 2007 against the plaintiff on August 6, 2009 (" August 4, 2009" stated in the purport of the claim is deemed to be a clerical error).

1. Details of the disposition;

A. On December 7, 1982, the Plaintiff purchased and owned 23,393,000 square meters of ○○-dong 45-2, 00,000, and sold KRW 651,00,000 on May 15, 2007. On July 31, 2007, the Plaintiff reported and paid KRW 130,885,680 of the capital gains tax on the instant land.

B. On October 23, 2008, the Plaintiff filed a request for correction to the Defendant for refund of KRW 90,000,000 for capital gains tax, alleging that the tax exemption provision under the Act on Special Cases concerning Taxation (amended by Act No. 9276, Dec. 29, 2008; hereinafter the same) is applicable, since the instant farmland falls under one of its own farmland for not less than eight years.

C. Accordingly, on August 6, 2009, the defendant rejected correction on the ground that the plaintiff did not own the farmland of this case for more than eight years and did not reside in the farmland of this case or the administrative district adjacent thereto (hereinafter referred to as the "disposition of this case").

D. On November 2, 2009, the Plaintiff filed an appeal with the Tax Tribunal, but was dismissed on December 31 of the same year.

[Ground for Recognition: absence of dispute, entry of Gap evidence 1, 2, Eul evidence 1, 2, and 1, and 2, whether all pleadings are held]

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

At the time of the purchase of the farmland of this case, the Plaintiff was residing in △△△-gu, △△△△-dong, adjacent to the location of the farmland of this case, and was directly cultivated Gomama and Gomama in the farmland of this case from around 1984 to the time of selling the farmland of this case. Therefore, the Defendant’s disposition of this case reported differently is unlawful, even though the sale price of the farmland of this case was reduced by capital gains tax under the Restriction of Special Taxation Act.

(b) Related statutes;

It is as shown in the attached Table related statutes.

C. Determination

1) According to the main text of Article 69(1) of the Restriction of Special Taxation Act and Article 66(1)4(12) of the Enforcement Decree of the same Act (amended by Presidential Decree No. 20620 of Feb. 22, 2008), in order for a transferor to obtain reduction of or exemption from capital gains tax on self-arable farmland, the fact that the transferor resided in a Si/Gun/Gu where the farmland is located or in a location of a Si/Gun/Gu, such as a location (including an area corresponding to the relevant area at the time of commencement of cultivation but does not fall under such area due to reorganization of administrative district, etc.) adjacent to the said area, and directly cultivated the relevant farmland for not less than eight years from the time of acquisition until the time of transfer. The "direct cultivation" here refers to the case where the transferor engages in cultivating the crops or growing perennial plants on his own farmland at all times or with his own labor.

2) In light of the above facts, the Plaintiff’s 1 to 4, 13, 5-1 to 6-15, 1, 2, 4, and 8-1 to 5, and the overall purport of the pleadings is as follows: (a) the Plaintiff’s farmland ledger (No. 3) was first prepared on September 27, 206; (b) △△△-Gu 4, 741-11, △△△△-1, which had been operated by the Plaintiff’s wife, had been located in the above farmland for 5-1 to 5-1 to 10, and the Plaintiff’s farmland had been located in the above 5-1 to 10-7, which had been located in the above farmland for 5-1 to 5-1 to 207, and the Plaintiff’s farmland had been located in the above 4-1 to 5-1 to 3-5, which had been found that there was a lack of time to cultivate or cultivate the farmland among the above farmland.

3. Conclusion

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