Appellate Court 2014west 4354 (O23, 2015)

No error in disposition imposing tax on the transfer of unregistered assets shall be found.

The sale of this case is not a transfer of the right to acquire real estate, but a transfer of real estate, because the sale of this case is not a transfer of the right to acquire real estate, by failing to take measures such as changing the nominal owner in the sale contract, etc.

Article 104 of the Transfer Income Tax Act

2015Gudan5212 Revocation of Disposition of Imposing capital gains tax, etc.

KimA

Head of Seodaemun Tax Office

November 19, 2015

on 28, 2016

1. The plaintiff's claim is dismissed.

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

Cheong-gu Office

The disposition of imposition by the Defendant on August 1, 2014 rendered by the Plaintiff on August 1, 2014 is revoked.

1. Details of the disposition;

A. O-OB O-OB O-OB-OO on April 12, 2004, the registration of ownership preservation was completed in the name of CCC on July 16, 2004.

B. Around February 15, 2005, the Plaintiff reported the transfer income tax with the transfer value and acquisition value as the OO won, if it transferred the right to acquire real estate to stuff.

C. On the other hand, the head of the Ansan Tax Office deemed that the Plaintiff under-reported the transfer value due to the preparation of a false contract in the process of re-audit for confirmation of acquisition value in connection with the report of transfer income tax on the instant real estate by ParkD.

D. Accordingly, the Defendant conducted an investigation of capital gains tax against the Plaintiff on August 1, 2014, and deemed that the Plaintiff transferred unregistered assets to ParkD to the Plaintiff, and determined and notified the capital gains tax OO of the transfer income tax for 2004 calculated by using the transfer value as OO.

E. On August 20, 2014, the Plaintiff appealed, and filed an appeal on around August 20, 2014. On February 23, 2015, the Tax Tribunal rendered a decision that “OO members received from ParkD from the transferee shall be excluded from the transfer value of the instant real estate, and the tax base and tax amount shall be corrected, and the remainder of the appeal shall be dismissed.”

F. In accordance with the purport of the adjudication decision above, the Defendant notified the correction of the capital gains tax OO(including additional tax OOO) calculated by using the transfer value of the instant real estate as OO as the transfer value on March 11, 2015 (hereinafter “the disposition of this case,” which was corrected on August 1, 2014.

[Reasons for Recognition] Facts without dispute, Gap 1 to 7 evidence, Eul 1 to 4, 13 evidence (including each number), the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The Plaintiff did not transfer the instant real estate, but transferred the right to acquire the instant real estate, and the registration of acquisition was legally impossible. Therefore, the instant disposition that applied the heavy taxation rate on the ground that the Plaintiff reselled unregistered transferred assets.

B. Determination

1) Relevant legal principles

Article 94 (1) of the former Income Tax Act (amended by Act No. 7319 of Dec. 31, 2004; hereinafter "the Income Tax Act") provides that "transfer income shall be the income falling under any of the following subparagraphs generated in the current year" and "income accruing from the transfer of the right to acquire real estate" under subparagraph 1 and subparagraph 2 (a) shall be the income subject to taxation. Meanwhile, Article 104 (1) 3 of the Income Tax Act, which sets the transfer income tax rate of 70/10 of the transfer income tax base, applies to unregistered transferred assets, while Article 94 (1) 3 of the former Income Tax Act provides that "transfer of unregistered assets under paragraph (3) means that a person who acquires assets under Article 94 (1) 1 and 2 without registering the acquisition of such assets."

Meanwhile, even if a purchaser who entered into a real estate sales contract transfers his/her rights and duties or the purchaser’s status to a third party and withdraws from the sales contract, it is merely a transfer of the right to acquire real estate, and the registration of acquisition is not possible in principle unless there are special circumstances, such as special agreements prior to the transfer of the registration of ownership transfer even before the balance is paid in full, barring any special circumstances, and even if such transfer is made, the heavy taxation rate on unregistered transferred assets under Article 104(1)3 of the former Income Tax Act cannot be applied (see, e.g., Supreme Court Decision 2010Du23408, Sept. 27, 2012). However, even if the purchaser who entered into a real estate sales contract fails to pay the price in full, if the purchaser again enters into a sales contract with a third party while maintaining the status of the purchaser, it constitutes a transfer of real estate under the name of the purchaser. Accordingly, if the purchaser completely pays the price to the seller, it is possible for the purchaser to register the ownership transfer without delay to a third party.

In addition, the purport that the transfer income tax is levied on the unregistered transfer assets is to prevent the transfer of assets without registering their acquisition at the time of transfer by the person who acquired the assets, thereby evading various taxes, such as transfer income tax, or selling and purchasing the assets before transfer without paying the remaining amount of transfer margin. Thus, in acquiring the assets at the beginning, it is recognized that there is no purpose of speculation such as tax avoidance through the transfer of assets, or acquisition of resale gains, etc., and in other cases, in which it is deemed that it is harsh to enforce the transferor the responsibility of failing to register the acquisition of the assets at the time of transfer to the transferor, i.e., in cases where there is an inevitable circumstance, it shall be excluded from the unregistered transfer assets subject to transfer under the proviso of Article 70 (7) of the former Income Tax Act, Article 121-2 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 1467, Dec. 31, 194; Presidential Decree No. 14824, Apr. 11, 1995; Presidential Decree No. 2009>

(ii) the facts of recognition

A) On September 30, 2002, the Plaintiff entered into a sales contract (hereinafter referred to as the “sale contract in this case”) with CCC Co., Ltd. (hereinafter referred to as “SCC”) to sell the instant real estate in the purchase price to OO members (in the event of a contract, the first intermediate OO members of the contract, March 10, 2003, the second intermediate OO members of the intermediate payment, November 10, 2003, and the second intermediate payment OO members of the contract will pay to the scheduled date of occupancy).

B) According to the instant sales contract, the Plaintiff paid the down payment OO of the down payment to the Nonparty Company on September 30, 2002, and the first part OO of the intermediate payment on March 31, 2003, respectively.

C) The Plaintiff decided to sell the instant real estate to Park DoD (hereinafter referred to as “the instant sale”), and Park DoD paid OO to the Plaintiff on July 16, 2004 with regard to the instant sale, and on the same day, deposited OO won to the account of the non-party company upon the Plaintiff’s request, and thereafter, paid OO won to the Plaintiff on March 2009 and around February 2010.

D) As of August 17, 2004, the Plaintiff: (a) sold the instant real estate to Park DoD in the purchase price; (b) prepared a sales contract stating that “the seller shall deliver all documents necessary for resale to the purchaser on the date of the remainder payment; (c) overdue interest and management expenses until the date of the contract; and (d) the buyer shall accept all the expenses from the date of the contract.”

[Reasons for Recognition] Facts without dispute, Gap evidence 1-3, 4, Eul evidence 1-2, 2, 3, 5, 6, 7, 9, 12, and the purport of the whole pleadings

3) Determination

The fact that the Plaintiff entered into a sales contract with ParkD without paying the sales price in full with the company is as seen earlier. However, although the Plaintiff had ParkD deposit the remaining sales price into the account of the company directly, it seems that the Plaintiff still maintained the right and duty relationship under the sales contract by failing to take measures such as changing the nominal owner under the sales contract in this case with the company.

Thus, the sale of this case constitutes the transfer of real estate, not the transfer of the right to acquire real estate.

In addition, since the registration of preservation of ownership of the instant real estate was completed at the time of the sale of the instant real estate in the name of the non-party company, the Plaintiff did not immediately complete the balance and late payment due to the instant sales contract and completed the registration of transfer of ownership to Park DoD without making it possible to register its acquisition in its own name. It is difficult to deem that there is an inevitable circumstance that the Plaintiff did not register its acquisition in its own name. In addition, in light of the fact that the sales contract prepared by the Plaintiff on August 17, 2004 entered the sales price as OO in the OO, it is difficult to deem that the Plaintiff did not have an objective of speculation, such as tax avoidance or resale acquisition through the transfer of unregistered assets.

Therefore, since the sale of this case constitutes an unregistered transfer asset under Article 104 (1) 3 of the Income Tax Act, the prior disposition of this case is lawful on the same premise.

3. Conclusion

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