Appropriateness of the assertion that there is an actual contract on the disposition of conversion acquisition value

Although the acquisition value is not verified and determined as the conversion value, the original disposition is legitimate because it is not verified on the basis of the contract and value submitted by the transferor as the actual contract, and the statement by three witnesses, notwithstanding the statement by three witnesses.

Determination and correction of Article 176-2 of the Enforcement Decree of the Income Tax Act for Calculation of Transfer Marginal Profits

1. The plaintiff's claim is dismissed.

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

The Defendant’s disposition of imposition of capital gains tax of KRW 82,051,530 for the Plaintiff on March 9, 2007 shall be revoked.

1. Details of the disposition;

A. The ○○○○○○○ (hereinafter referred to as “the deceased”) purchased 000,000,000,0000 and 0000 (hereinafter referred to as “○○○○○○○○○○○○○○○○○,” hereinafter referred to as “the instant real property”) from the official ○○○ on September 3, 2001, and subsequently transferred 1.58 billion won to Kim○○ on June 14, 2004 on August 19, 2004, and died on August 19, 2004. The deceased’s heir as the deceased’s property has recommendation as the wife, right ○○○, and right ○○○, a child.

B. As the deceased and the plaintiff did not report the tax base of transfer income for the year 2004 following the transfer of the real estate in this case, the defendant calculated transfer gains by converting the above transfer value into the standard market price at the time of acquisition and transfer pursuant to Article 114 (5) of the former Income Tax Act (amended by Act No. 7837 of Dec. 31, 2005) and Article 176-2 (2) 2 of the former Enforcement Decree of Income Tax Act (amended by Presidential Decree No. 18988 of Aug. 5, 2005), on the ground that the transfer value of the real estate in this case is 1,346,860,39 won, and on March 9, 2007, the plaintiff et al., a heir of the deceased, were jointly and severally liable to pay the transfer income tax for the year 204, 8051, 5305 won.

[Grounds for Recognition] Unsatisfy, Gap 1, Eul 1, 3

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

In purchasing the instant real property from ○○○, the deceased acquired the obligation of KRW 1182,500,000,000 in total amount of KRW 850,000,000 in national bank loans, KRW 250,000,000 in total of KRW 82,50,000,000 in cash, and KRW 1.42,55,50,000 in total of KRW 1,428,00 in cash, on the ground that it is difficult to verify the real acquisition value of the instant real property, the Defendant issued the instant disposition by applying the conversion price under Article 114(5), etc. of the former Income Tax Act, which is unlawful and revoked.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

Therefore, as alleged by the Plaintiff, whether the deceased acquired the instant real estate at KRW 1.428 billion by means of the method as alleged by the Plaintiff can not be recognized solely based on the fact-finding by the ○○○○ branch of ○○○○○○ Bank, and there is no other evidence to acknowledge it.

Therefore, 1.428 billion won, which the Plaintiff asserts as the acquisition value of the real estate of this case, cannot be confirmed as the actual transaction value. Thus, in calculating the gains on transfer of the real estate of this case, its acquisition value shall be applied to the value converted under Article 114 (5) of the former Income Tax Act and Article 176-2 (2) 2 of the former Enforcement Decree of Income Tax Act, and thus, the disposition of this case, which calculated gains on transfer and the amount of capital gains tax

3. Conclusion

Thus, the plaintiff's claim seeking cancellation of the disposition of this case cannot be accepted, and it is dismissed.

official training laws and regulations;

○ former Income Tax Act (amended by Act No. 7837 of Dec. 31, 2005)

Article 97 (Calculation of Necessary Expenses in Transfer Income)

(1) In calculating gains on transfer of a resident, necessary expenses to be deducted from the transfer value shall be as follows:

1. Acquisition value:

(a) In case of assets as prescribed in Article 94 (1) 1 and 2, the standard market price at the time the assets are acquired: Provided, That in case where the assets concerned fall under any of subparagraphs of Article 96 (1), it shall be based on the actual transaction price required for the acquisition of such assets;

(c) In the case of proviso (a) or (b), where it is impossible to confirm the actual transaction value at the time of acquisition, the transaction example value, appraisal value or conversion value

Article 100 (Calculation of Gains on Transfer)

(1) In the calculation of gains on transfer, if the transfer value is based on the actual market value (including the value under Article 96 (3) and the amount of transaction example or appraised value, etc. in the case where the relevant transaction example or appraised value is applied pursuant to Article 114 (5)), the acquisition value shall be based on the actual transaction value (including the value under Article 97 (7) and the amount of transaction example, appraisal value, conversion value, etc. in the case where the relevant transaction example, appraisal value, conversion value, etc. is applied pursuant to Article 114 (5)), and if the transfer value is based on the standard market

Article 114 (Determination, Revision and Notification of Tax Base for Transfer Income and Amount of Tax)

(4) If the chief of the district tax office or the director of the regional tax office having jurisdiction over the place of tax payment determines or revises the tax base of transfer income and the amount of tax under paragraphs (1) through (3), he shall determine or correct the tax base of transfer income and the amount of tax under Articles 96 and 97: Provided, That in case where the resident makes the preliminary return or the final return on the tax base of transfer income under Articles 96 (1) 6 and 97 (1) 1 (a) (proviso), and if the reported value is different from the fact, and if the

(5) In applying the provisions of paragraph (4), in case where the transfer value or acquisition value is based on the actual transaction value, and where it is impossible to recognize or confirm the actual transaction value at the time of transfer or acquisition of the relevant assets by the account books or other documentary evidence on the grounds as determined by the Presidential Decree, the transfer value or acquisition value may be determined or corrected by the estimated survey based on the transaction example value, appraisal value, conversion value (referring to the actual transaction value, purchase price or appraisal value converted by the method as determined by

1

○ former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 18988 of August 5, 2005)

Article 176-2 (Estimated Decision and Revision)

(2) The term “acquisition price converted by the method prescribed by the Presidential Decree” in Article 114 (5) of the Act means the acquisition price converted by the method in the following subparagraphs:

2. In the case of the rights to acquire the land, buildings and real estate under Article 96 (1) 1 through 7 of the Act (the provisions of subparagraph 6 shall apply only to the assets acquired before a fictitious acquisition date under paragraph (4)), the amount calculated by the following formula:

The actual transaction value at the time of transfer, transaction example under paragraph (3) 1, or appraisal value under subparagraph 2 of the same paragraph.

(3) Where the transfer value or acquisition value is determined or revised by estimation under Article 114 (5) of the Act, it shall be the value calculated by applying the method falling under each of the following subparagraphs in sequential order: Provided, That where it is deemed that the transaction example referred to in subparagraph 1 or the appraisal value referred to in subparagraph 2 is objectively unreasonable, etc. based on the transaction with the related parties referred to in Article 98 (1),

3. The end of acquisition price converted under paragraph (2); and