Presumption of Donation of Transfer of Unlisted Stocks between Lineal ascendants

Since the title trust of stocks cannot be deemed to have the purpose of tax avoidance, the disposition imposed on the deemed donation is unreasonable.

Article 44 of the Inheritance Tax and Gift Tax Act; Article 41-2 of the former Inheritance Tax and Gift Tax Act

1. Revocation of a judgment of the first instance;

2. The Defendant’s disposition of imposition of gift tax of KRW 93,331,00 against the Plaintiff on August 13, 2004 shall be revoked.

3. All costs of the lawsuit shall be borne by the defendant.

The same shall apply to the order.

1. Details of the disposition;

Facts that there is no dispute over recognition, Gap evidence 11, Eul evidence 1-1, Eul evidence 1-2, 2, and 5, and the purport of the whole pleadings.

A. On January 10, 2001, 200, ○○○○○ (hereinafter “○○○○○”) reported the tax base of corporate tax in 2001, submitted a detailed statement on the changes in stocks, which stated that each of 1,500 shares in the name of ○○○ and ○○○○○○, the former head of △△△△△△△△△△△, the Plaintiff’s father, and ○○○○○, the former head of △△△△△△,

B. As a result of conducting a tax investigation on the change of ○○○’s shares from May 31, 2004 to July 10, 200 of the same year, the director of the regional tax office of ○○○○○○○○○○○○, unlike the above details of the report, determined that Park○○’s shares 1,500 shares owned on January 10, 201 are donated to the Plaintiff, and that it was notified the Defendant of the determination that Park△△△○ succeeded to 1,50 shares of 1,50 shares of ○○○○○○○ who died on December 13, 200, and that it was donated to ○○○○○○○○ on January 10, 201.

C. On January 10, 2001, the Defendant: (a) deemed that ○○○ donated 1,500 shares of ○○○○○○○ (hereinafter “instant shares”) to the Plaintiff on January 10, 201 by applying the presumption of donation at the time of transfer to the spouse, etc. under Article 44(1) of the Inheritance Tax and Gift Tax Act (hereinafter “Inheritance Tax and Gift Tax Act”); and (b) assessed the market value of the said shares as KRW 275,50 per share, and assessed the taxable value of the gift at KRW 413,325,00,000 on August 13, 2004, the Defendant issued the instant disposition imposing KRW 93,31,000 on the Plaintiff.

2. Whether the instant disposition is lawful

A. The parties' assertion

(1) The plaintiff's assertion

(A) Around March 1989, Park △△△ opened a private company with the trade name of ○○○, and around December 1994, established a private company by converting the private company into ○○○○, a corporate entity for business reasons, etc. At the same time, at least seven persons under the commercial law, including the requirements of promoters, etc. 3,000 shares in title trust were held against 7 persons, including ○○ and Ga○○, and around June 1999, a certified tax accountant, who handled ○○○’s tax agent services around June 199, arranged the shareholders as 3, and arranged the shareholders as 1,50 shares to ○○ and Ga○○○, a former wife and Ga○○, a type of 1,500 shares each of 1,50 shares to ○○ and the Plaintiff without any tax avoidance purpose. Accordingly, the Defendant’s disposal of the shares in this case was unlawful on the premise that the Plaintiff’s disposal of the shares in this case was unlawful.

(B) The Plaintiff did not transfer the instant shares to the Plaintiff on the list of shareholders of ○○○○ at the time of title trust, and even if the Plaintiff reported shares transfer by entering the status of shares transfer in the statement of changes in stocks, it cannot be deemed that the instant shares were transferred to the Plaintiff. As such, the Defendant’s disposition was unlawful since it did not meet the requirements for presumption of gift under the Inheritance Tax and Gift Tax Act.

(2) The defendant's assertion

(A) The instant disposition is lawful in light of the grounds and relevant Acts and subordinate statutes.

(B) On January 10, 2001, the Plaintiff did not transfer the instant shares to the Plaintiff, and even if Park △△△△ held the title trust of the said shares, in light of the following: (a) the global income tax rate is applied when adding up the global income tax on the dividend income accrued; (b) the assertion at the time of filing the initial tax base return on the global income tax return; (c) the assertion in the pre-trial procedure; and (d) the assertion in the instant lawsuit are different and inconsistent; and (e) there is no consistency, it cannot be said that Park △△△△ did not have any purpose of tax avoidance in title trust with

(b) Related statutes;

It is as shown in the attached Table related statutes.

(c) Fact of recognition;

Facts that there is no dispute over recognition, Gap's evidence 2 through 36 (including additional numbers), Eul's evidence 7, the testimony and the purport of the whole pleadings of the first instance court witness Park △△△△, and Lee ○○○○, a witness of the first instance court.

(1) Establishment of ○○○○○ and the process of title trust of shares

(A) Around March 1989, Park △△△, the Plaintiff’s well-known, operated a personal business with the trade name of ○○○○○, and established ○○○○○ on December 19, 1994, by converting the said personal business entity into a corporation for business reasons. At the time, △△△△, all of the acquisition price of shares and the cost of establishing a company, etc. was borne by she.

(나) ○○○○ 설립 당시의 상법상 7인 이상 발기인 요건 등으로 인해 박△△은 처인 조○○, 형인 박○○, 누나인 박▲▲, 자형들인 김▲▲, 오▲▲, 동서인 이▲▲, 조카인 김▼▼ 등 7명의 명의를 빌려 자신과 이들을 발기인으로 한 정관을 작성하고, 전체 발행 주식 5,000주 중 1,500주를 조○○에게, 1,500주를 나머지 6명의 발기인들에게 각 250주씩 나누어 명의신탁 하였다.

(다) 그 후 1999. 6.경 ○○○○의 세무대리업무를 맡아오던 세무사 이○○ 사무소에서 업무처리상의 편의와 상법 제288조의 개정 등을 이유로 주주를 3인으로 정리할 것을 제안하였고, 박△△이 이를 승낙하여 김▲▲ 등 5명의 주식 합계 1,250주를 박○○이 인수한 것으로 주주명의를 정리하였으며, 이에 따라 위 ○○○○ 주식 1,500주의 명의수탁자가 박○○으로 변경되었다.

(라) 한편 ○○○○는 박○○이 1999. 6. 3. 김▲▲ 등 5명으로부터 위 주식 합계 1,250주를 합계 1,250만 원에 양수하였다는 내용의 각 주식양도양수계약서(갑 제8호증의 1 내지 5)를 작성하여 관할세무서에 제출하였으나, 박○○과 김▲▲ 등 5명 사이에 실제 양도양수계약을 체결하고 매매대금을 주고받은 적이 없고, 양도양수인으로 되어 있는 박○○, 김▲▲ 등이 실제 ○○○○ 주주로서의 권한을 행사한 바도 없다.

(2) Circumstances leading to reporting transfer and takeover of shares in the name of the Plaintiff and Kim○○.

(A) On December 13, 200, when ○○○○ registered as a director and auditor of ○○○○○○○○○○, died on December 13, 200. On January 11, 2001, according to the direction of △△△△△△△, the registration of death of ○○○○○, the registration of her director’s appointment of her director, the registration of her director’s appointment of her director, the audit of the Plaintiff, and the registration of her representative director’s appointment of her △△○○○○○○○○

(B) A certified tax accountant, who was responsible for the tax agent agent agent duty of ○○○○○○, was the head of the office of this ○○○○○○ office, and the head of knife knife knife knife knife knife knife knife knife knife knife knife knife knife knife knife knife knife knife on January 16, 200,

(C) The Park △△△△ requested that the Plaintiff’s corporate register and the shareholder registry registered in the de facto marital relationship with Kim○ and the auditor at the time be organized. On February 28, 2002, 200, the above Kim Madon completed the registration of the retirement of directors and the appointment of directors of Madon Kim○. On March 10, 2002, upon submitting a report on the tax base of the corporate tax base for 2001 at the district tax office having jurisdiction over the last day, the pertinent shares in the name of Madon were transferred to Kim○ on January 10, 201, and attached a detailed statement on changes in stocks to the Plaintiff on the same day.

(D) At the time, Park △△△△, Kim Man, etc. did not think of the importance of the transfer of shares to anyone at any time, and considered that the shares in the name of Park ○○ and Cho ○○ should be arranged as soon as possible. Accordingly, Kim Woo stated on the 10th day of the same month, which is the preceding day, as the date of receipt of shares, in consideration of the audit registration of the Plaintiff on January 11, 2001, which was the date of receipt of shares, but the fact that Cho ○ had already died prior to the date of transfer.

(E) On October 10, 2003, the person who was requested by the competent tax office to submit explanatory materials related to securities transaction tax without filing a report, Kim Wil, as of January 10, 2001, prepared the stock transfer contract (A evidence No. 13-1, 2) retroactively as of January 10, 201, and submitted each of the above contracts to the competent tax office on the 30th of the same month.

(3) The reason why ○○○ filed a tax investigation and a request for a national tax trial

(A) As a result of conducting a tax investigation on the change of ○○○’s shares from May 31, 2004 to July 10 of the same year, the director of the regional tax office of ○○○○○○○○○○○○○, unlike the above contents of the report, judged on January 10, 201 that the instant shares were actually donated to the Plaintiff on January 10, 201, the head of ○○○○○○○○○○○○○○○, who was a son, succeeded to the shares of ○○○○○○○, and notified the Defendant thereof. Accordingly, the Defendant rendered the instant disposition against the Plaintiff on August 13, 2004

(B) Although ○○○○ intended to file an objection to the instant disposition and file a request for a national tax trial on behalf of another, on January 10, 2001, tax accountants, who had an objection to the imposition of a gift tax on the instant disposition and the gift tax on Kim ○, who had been dissatisfied with the unexpected business process, such as preparing and submitting a written contract with the purport that the Plaintiff acquired the shares of ○○, which had already died, at the competent tax office, delegated △△△△ on October 2004, a request for a judgment on national tax against

(C) Before submitting a written request for a national tax trial, the certified tax accountant Kim Jong-soo argued that the instant shares were owned by Park △△△△△ and that the Plaintiff and Kim ○○○ was merely a title trustee, but the National Tax Service did not recognize it. As such, in the case of Kim ○, he received a donation from Park △△△△, and received a spouse deduction from Park △△△△△, and received a spouse deduction, and in the case of the Plaintiff, the amount of the gift tax shall be calculated again. In the case of the Plaintiff, the amount of the inheritance tax shall be calculated on the basis that he received a inheritance from Park ○, and the Plaintiff shall be deemed to have never received a substantial tax burden. Unlike the fact, the written request for a national tax trial, contrary to the facts,

(4) Whether ○○○○’s distribution was made

(A) The ○○○○ does not fail to pay taxes from the time of establishment on December 19, 1994 to the time of closure of business on May 20, 2004; there was no distribution for the same period; and there was no earned surplus at all at the time of closure of business due to the disposal of loss against the account receivable, etc.

(B) On the other hand, Park △△△△ was introduced by the former wife ○ on December 13, 200 and 7 months after the death of December 13, 2000, and was in de facto marital relationship since the latter part of 2001, and was dead on January 16, 2002, and on February 28, 2002, the registration of the appointment of the director for Kim ○ was completed, and on January 24, 2003, the marriage was reported with Kim ○.

D. Determination

(1) As to whether the instant shares were transferred or not

First of all, as to ○○○○○○○○○○○○○○○○○○○○○○○○○○○○’s shares transferred to the Plaintiff on January 10, 201, it is insufficient to recognize the transfer of the shares solely on the basis of the No. 13-2, No. 2, and No. 7, and there is no other evidence to acknowledge the transfer of the shares. Rather, as seen earlier, ○○○○○○○○○○○○○○○○○○○○○○○○’s shares issued on December 194 distributed 1,50 shares to 5,00 out of the total issued shares, and instead, 1,50 shares were transferred to ○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○’s shares issued on the premise that the shares were transferred to ○○○○○○○○○○○○○○○.

(2) As to the assertion of deemed donation of nominal trust property

(A) Even if the fact of title trust is recognized, the Defendant asserts to the effect that the instant disposition is legitimate in accordance with the provision on the constructive gift of title trust property under Article 41-2(1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 6780, Dec. 18, 2002; hereinafter “former Inheritance Tax and Gift Tax Act”).

(B) First, we examine whether the identity of the disposition is maintained in a case where the Defendant asserted the presumption of donation on the spouse, etc. under Article 44(1) of the Inheritance Tax and Gift Tax Act as the disposition cause of this case, and again claims to add the constructive gift of title trust property under Article 41-2(1) of the same Act as the disposition

Even if there are errors or errors in part of the facts recognized at the time of the initial disposition by the tax authorities, if the facts recognized thereafter are not different from the original facts of taxation, the identity of the disposition is maintained unless the basic facts of taxation are different (see Supreme Court Decision 96Nu3272, Feb. 11, 1997). However, where the applicable Acts and subordinate statutes vary depending on the date of donation, and where the total amount of donated property received from the same person within 10 million won exceeds 10,000 won within 10 years prior to the date of donation, the amount of gift tax shall be determined by applying the progressive tax rate to the total amount of the taxable value of donated property. In light of the fact that the value of donated property is assessed on the basis of the date of donation, if there is a difference between the date of donation and the presumption of donation, the basic facts of taxation are changed

Therefore, as in the instant case, the Defendant presumed on January 10, 201 that Park○○ transferred the instant shares to the Plaintiff, who was a son, and issued the instant disposition by presumed that the Plaintiff was donated the same shares. In the event that Park△△△△ was found to have held the title trust of the instant shares to the Plaintiff on or around March 2002, the Defendant’s new ground for asserting the constructive gift of title trust property was different from the instant disposition on or around January 10, 2001, and thus, the identity of the taxation disposition is no longer maintained, and thus, it cannot be asserted as a legitimate ground for the instant disposition.

(C) Next, even if the identity of the taxation disposition is maintained, it is examined as to whether Park △△△ was the purpose of tax avoidance in the instant title trust to the Plaintiff.

The legislative purport of Article 41-2(1) of the former Inheritance Tax and Gift Tax Act is to recognize an exception to the substance over form principle in the purport that the act of tax avoidance using the title trust system is effectively prevented, thereby realizing the tax justice. Thus, if the title trust was recognized to have been conducted for any reason other than the purpose of tax avoidance, and it is merely a minor reduction of tax incidental to the said title trust, it cannot be deemed that there was a "tax avoidance purpose" under the proviso of the same Article in such title trust, and the burden of proving that there was no purpose of tax avoidance in the title trust has the burden of proving that there was no purpose of tax avoidance (see, e.g., Supreme Court Decisions 2005Du14714, Jun. 9, 2006; 2004Du7733, May 12, 2006).

In this case, the following circumstances revealed in the above facts. ① △△△△△△△△△△△ was entrusted with the title of 3,00 shares under the name of 7 persons, such as Park○○, etc., due to the requirements of promoters under the Commercial Act at the time of establishing ○○○○○○, and ② △△△△△△△△△△△△△△△ was entrusted with the shares of this case upon organizing three shareholders for the convenience of business operations thereafter; ③ Park○○○ on January 16, 2002, when there were concerns over the imposition of fines for negligence due to neglect of corporate registration, the registration of the title trust and the registration of the office of ○○○○○○○○○○○’s director was completed on February 28 of the same year. The Plaintiff did not have any reason to deem that the Plaintiff had been transferred the shares of this case at the time of reporting the tax base for 201, under the premise that the Plaintiff did not have any other purpose of tax evasion from the title trust under the name of the Plaintiff.

3. Conclusion

Therefore, the plaintiff's claim of this case shall be accepted on the grounds of its reasoning, and since the judgment of the court of first instance is unfair on the grounds of its conclusion, the plaintiff's appeal is accepted, and the judgment of the court of first instance is revoked and the defendant's disposition of this case is revoked.

Related Acts and subordinate statutes

1. Inheritance Tax and Gift Tax Act;

Article 44 (Presumption of Donation at Time of Transfer to Spouse, etc.) (1) The property transferred to the spouse, or lineal ascendants and descendants (hereafter in this Article, referred to as the “spouse, etc.”) shall be presumed to have been donated by the spouse, etc. at the time when the transferor transfers the property, and it shall be deemed

(2) In cases where the aggregate of the value of donated property received from the same person (in cases where the donor is a lineal ascendant, including the spouse of such lineal ascendant) within 10 million won from the relevant donation date, such value shall be added to the taxable amount of gift taxes: Provided, That in cases of donated property excluded from adding, this shall not apply.

2. The former Inheritance Tax and Gift Tax Act (amended by Act No. 6780 of Dec. 18, 2002)

(1) In case where the actual owner and the nominal owner are different in property (excluding land and buildings; hereafter in this Article the same shall apply), the value of the relevant property shall be deemed to have been donated from the actual owner on the date when it is registered, etc. as the nominal owner, notwithstanding the provisions of Article 14 of the Framework Act on National Taxes, by the nominal owner: Provided, That the same shall not apply to cases falling under any of the following subparagraphs:

1. Where assets are registered, etc. in the name of another person without the purpose of tax avoidance;

3. Commercial Act;

Article 288 (Promoters) Any promoter who establishes a stock company shall prepare the articles of incorporation.

4. The former Commercial Act (amended by Act No. 6488 of July 24, 2001)

Article 288 (Promoters) Three or more promoters shall be required for the incorporation of a stock company.

5. The former Commercial Act (amended by Act No. 5053 of Dec. 29, 1995)

Article 288 (Promoters) At least seven promoters shall be required for the incorporation of a stock company.

6. The former Local Tax Act (amended by Act No. 8147 of Dec. 30, 2006)

Article 22 (Secondary Liability for Tax Payment of Contributors) Where the property of a corporation (excluding a corporation whose stocks are listed on the Korea Stock Exchange) is imposed on such corporation, or where it falls short of appropriating the impositions of a local government to be paid by such corporation, the person falling under any of the following subparagraphs as of the tax base date of impositions of the local government or the date on which the tax liability is established (the date on which tax payment period commences, in cases of items of tax for which no provision exists), shall assume the secondary liability for tax payment of such shortage: Provided, That in cases of oligopolistic stockholders under subparagraph 2, the tax liability shall be limited to an amount calculated by multiplying the shortage by the number of stocks owned (excluding non-voting stocks; hereafter the same shall apply in this Article) or investments (in cases of oligopolistic stockholders under subparagraph 2 (a) and (b), the number

2. A person falling under any of the following items from among oligopolistic shareholders (referring to the persons in whose case the total amount of stocks held or investments made by a stockholder or a partner with limited liability and relatives or other persons having special relations with him as prescribed by the Presidential Decree is 51/100 or more of the total number of stocks issued or total investments of the relevant corporation

(a) A person who exercises a substantial right over the stocks or investment shares in excess of 51/100 of the total issued stocks or total investments of the relevant corporation;

(b) An honorary chairperson, chairperson, president, vice president, senior managing director, managing director, director, or any other person who actually controls the management of the corporation, notwithstanding the title thereof;

(c) Spouse (including a person in de facto marital relationship) of the persons prescribed in items (a) and (b) and the lineal ascendants and descendants sharing the same livelihood

7. Enforcement Decree of the Local Tax Act;

Article 6 (Scope of Relatives and Other Specially Related Persons) (1) The term "relatives or other person having a special relation as prescribed by the Presidential Decree" in subparagraph 1 of Article 22 of the Act means a person falling under any of the following subparagraphs: Provided, That where a stockholder or partner with limited liability is a woman, excluding the cases of subparagraphs 9 through 13, the relationship with the husband shall be governed by

1. Paternal relatives within the sixth degree and the wife of any paternal blood relationship within the fourth degree;

5. The spouse (including the person in de facto marital relations) end; and