Whether it can be seen as real estate trading business

Whether the income from the sale and purchase of real estate is business income under the Income Tax Act shall be determined according to social norms, considering whether the sale and purchase is for profit-making purposes and whether the sale and purchase is continuous and repeated to the extent that business activities can be seen as business activities in light of the number of times of the sale

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

The plaintiff's claim is dismissed. The costs of lawsuit are assessed against the plaintiff.

1. Details of the disposition;

The following facts may be acknowledged by each entry of Gap evidence 1, Gap evidence 4, Gap evidence 8, and 9, unless there is a dispute between the parties or by each entry of Gap evidence.

(1) On February 3, 1989, the Plaintiff entered into a partnership business agreement with Nonparty A, and acquired 659 square meters from the site of ○○○-dong 340, 340,000, at November 20 of the same year, and newly constructed 1,796.49 square meters on the ground of reinforced concrete building 1,796.49 square meters on the ground, and transferred the said land and buildings (hereinafter the instant real estate) to Nonparty B Nonparty 1, 190 for price of 2,00,000,000 won.

(2) On September 16, 1991, the Defendant deemed that the Plaintiff was engaged in real estate sales business and deemed that the transfer margin therefrom falls under the business income generated from real estate sales business under Article 20(1)8 of the Income Tax Act and Article 36 subparag. 3 of the Enforcement Decree of the same Act, and imposed global income tax on the Plaintiff and notified the Plaintiff of KRW 134,692,110 and KRW 26,938,420. On October 1, 1992, the Defendant issued a disposition to impose global income tax amounting to KRW 40,654,420 and KRW 175,346,530, the defense tax amounting to KRW 8,130,80 were increased as KRW 35,069,30 and KRW 300 was reduced as income from real estate sales business under Article 36 subparag. 3 of the Enforcement Decree of the same Act (hereinafter the instant disposition). In other words, according to the determination of the tax base for reduction of national tax.

2. Whether the disposition is lawful;

A. The parties' assertion

The defendant asserts that the disposition of this case is lawful on the grounds of the above disposition and the applicable provisions of law, the plaintiff asserts as follows.

(1) According to the General Rules of the Income Tax Act and the Enforcement Rule of the Value-Added Tax Act (Article 1(1)), in cases where real estate is sold or real estate is acquired at least once during a taxable period of one taxable period under the Value-Added Tax Act for the purpose of business, and the real estate is sold at least twice, it shall be deemed that the Plaintiff is engaged in real estate sales business. Thus, even though the transfer of the real estate does not meet the requirements for deeming that the transfer of the real estate does not constitute real estate sales business, the Defendant’s disposition of this case is against

(2) In order for a real estate transfer income to be subject to global income tax to constitute a business income subject to global income tax, the sales of the real estate should aim at profit and have continuity and repetition to the extent that it can be seen as a business activity. However, although the Plaintiff previously conducted a real estate transfer for the purpose of transferring a residence or for raising the profit from the lease of a real estate, it is unlawful for the Defendant to regard the instant real estate transfer as a real estate sale business even though it did not have any real estate transaction for the purpose of transferring

B. Determination

(1) General Rule 2-4-8-20(1)1 of the Income Tax Act and Article 1(1) of the Enforcement Rule of the Value-Added Tax Act stipulate that real estate shall be sold and purchased or sold at least once within a taxable period of one taxable period under the Value-Added Tax Act for the purpose of business, or real estate shall be acquired and sold at least twice within the scope of real estate sales. In light of the purport of the above provision, the above provision is an exceptional provision that can be seen as real estate sales and can only be seen as falling under such conditions, and it shall not be regarded as a listed provision that can be seen as falling under real estate sales. Therefore, whether the Plaintiff’s transfer of real estate constitutes real estate sales or sale of real estate shall be determined in accordance with the following criteria, not by limiting the above provision, and the Plaintiff’s first argument

(2) Whether the sale and purchase of a certain real estate constitutes business income under the Income Tax Act or is merely subject to the transfer income tax under the Income Tax Act shall be determined according to the ordinary social norms, taking into account whether the sale and purchase is for profit-making purposes and whether there is continuity and repetition of the degree to be viewed as business activities in light of the scale, frequency, mode, etc. of the sale and purchase.

Comprehensively taking account of all the statements in Gap evidence Nos. 13-2 through 24-1,2, Eul evidence Nos. 13-2, and Eul evidence Nos. 7 and the purport of the oral argument in the testimony (except for the portion not trusted) of Park Jong-A as to this case, the plaintiff acquired land 3,576.7 square meters and building Nos. 548.54 square meters for 16 years from 1977 to 190, and transferred land 2,732.09 square meters and building Nos. 3,658.51 square meters for 11 times to 3,658.6, the plaintiff acquired the above real estate jointly with the non-party No. 1987 to 190 and sold the above real estate and newly constructed the building and newly constructed the real estate to the non-party No. 1987 to 190, the plaintiff can be seen as a sale and sale of the real estate to the non-party No. 5-party No. 6.

(3) Therefore, the instant disposition imposing global income tax, etc. on the Plaintiff is lawful, considering that the Defendant’s income therefrom is the business income generated from real estate sales business under Article 20(1)8 of the Income Tax Act and Article 36 subparag. 3 of the Enforcement Decree of the same Act.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and the costs of lawsuit are assessed against the plaintiff who has lost. It is so decided as per Disposition.