Seoul Administrative Court 2010Gudan540 ( October 19, 2010)

early 2009west2960 ( December 29, 2009)

Income accrued from the transfer of forest trees shall be deemed business income only if there is business feasibility.

(As in the judgment of the court of first instance, the transfer income of forest land and forest trees may not be separated from the transfer income of forest land, on the ground that even though it is found that there is no evidence that the afforestation business has been continuously conducted, there is no fact that the forest management plan has been authorized or the business has been registered, and that there is no method of public announcement of registration of preservation of ownership of forest trees, etc.

2010Nu40757 Revocation of Disposition rejecting capital gains tax rectification

IsaA

○ Head of tax office

Seoul Administrative Court Decision 2010Gudan540 decided October 19, 2010

May 4, 2011

May 18, 201

1. The plaintiff's appeal is dismissed.

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

The judgment of the first instance shall be revoked. The defendant's rejection disposition against the correction of capital gains tax against the plaintiff on April 29, 2009 shall be revoked.

1. cite the judgment of the first instance;

The reasons for this case can not be classified and calculated by the court of first instance, with the exception of adding the following: Article 8(2) of the Administrative Litigation Act and Article 420 of the Civil Procedure Act:

[Plaintiff’s decision on feasibility is unfair on the basis of whether the act of transferring forest trees continues to be and repeated, and according to the Korean Standard Industrial Classification, which is the standard for determining the scope of business subject to the business income tax pursuant to Article 29 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 20618, Feb. 22, 2008), the Plaintiff asserts that the growing business, one of the forestry, is defined as “a tree planting, cultivating, and protecting industrial activities” in order to produce forest trees, and should be determined on the basis of whether it falls under this.

The determination of feasibility only depending on whether the act of transferring forest trees continues and repeats is erroneous as alleged by the Plaintiff. However, Article 19(1)1 of the Income Tax Act stipulates income generated from agriculture and forestry as one of business income, and Article 29 of the Enforcement Decree of the Income Tax Act provides that Article 29 of the Enforcement Decree of the Income Tax Act is based on the Korean Standard Industrial Classification as to the scope of business activities under each subparagraph of Article 19 of the Act. Therefore, Article 29 of the Enforcement Decree provides that the scope of agriculture, forestry, etc. shall be governed by the Korean Standard Industrial Classification. The Plaintiff’s act of planting and tending trees does not constitute income earned from the transfer of the forest land in this case from the transfer of the forest in this case, not from the transfer of the forest in this case, the transfer of trees, such as transfer of trees, along with the forest land, shall be deemed as part of the forestry. Considering the various circumstances recognized earlier, it does not seem that the Plaintiff

2. Conclusion

The appeal is dismissed.