Seoul Administrative Court-2017-Gu Partnership-52535 ( November 30, 2017)

The disposition imposing gift tax is legitimate, even if the title truster is not specified.

Article 45-2 (1) of the former Inheritance Tax and Gift Tax Act does not require a specific specification of the truster, and since the net profit and loss for the last three years cannot be deemed to be abnormal, the stock evaluation is lawful.

Article 45-2 of the former Inheritance Tax and Gift Tax Act / [Presumption of Donation of Trust Property]

2017Nu8864 Revocation of Disposition of Imposition of Gift Tax

@@@

00. Head of tax office

March 27, 2018

April 10, 2018

1. The plaintiff's appeal is dismissed.

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

The judgment of the first instance is revoked. The defendant's disposition of imposition of gift tax of KRW 00,00,000 (including additional tax) imposed on the plaintiff*.

1. Quotation of judgment of the first instance;

The court's explanation on this case is consistent with the reasoning of the judgment of the court of first instance, except for dismissal or addition as follows. Thus, it shall accept it in accordance with Article 8 (2) of the Administrative Litigation Act and Article 420 of the Civil Procedure Act.

○ On December 2, 2015, following the second sentence of the first instance court, the second sentence "*.................... *........"

00,000,000 per share below 5th of the first instance judgment, with "00,000,000" of "0,000,000"

○ On the 8th judgment of the first instance court, the following shall be added to:

On the other hand, the Plaintiff asserts that if the title truster is not specified, it is difficult to prove that the title truster does not have any purpose of tax avoidance; it is impossible to impose joint and several tax liability on the title truster deemed the donor; and that it is impossible to confirm the application of the gift tax deduction based on the relationship between the donor and the donee; thus, it is impossible to accurately calculate the amount of tax. Therefore, the Defendant must specify the title truster.

Article 45-2 (1) of the former Inheritance Tax and Gift Tax Act only requires that the actual owner and the nominal owner be different in property requiring registration, etc., and does not necessarily require that the actual owner be specified. In light of the legislative intent of the above provision, even in cases where the title truster is not specified as an act of tax avoidance that interferes with the exercise of the State’s right to impose taxes by making it unclear the actual owner of the property right, it shall be interpreted that gift tax may be levied on the title trustee by applying the above provision. Even if the title truster is not specified, even if the title truster is not specified, there is no particular difference between the case where the title truster is found in the possibility of criticism that the title truster was acting in the act of tax evasion by the title truster, and if it is interpreted that the above provision can be applied only when the title truster is specified, it may result in a violation of the equity in giving the benefit

As such, the fact that a title truster does not need to be specified in the application of the above provision is a result of reasonable interpretation of the law, the legislative intent, and the necessity for exercising appropriate tax authority consistent with the tax justice, and it cannot be deemed any different for the convenience of proving the absence of the purpose of tax avoidance. In addition, the fact that the title truster and the title trustee participated in the act under an agreement or communication between the title truster and the title trustee is common in cases where it is not difficult for the title trustee to hold the materials on the part of the title trustee or obtain them from the title trustee. Therefore, it is difficult for the title trustee to prove the absence of the purpose of tax avoidance, rather than for the case where the tax authority failed to disclose a specific title truster, and even if a specific title truster is not identified, imposing the burden of proof on the absence of the purpose of tax avoidance is still consistent with the principle of equity.

In addition, even if the truster is not specified, the possibility of criticism on the act of tax avoidance, which is a basis for imposing gift tax, cannot be said to be extinguished even if the truster is unable to impose the joint tax liability unless it is specified. The denial of the exercise of the right to impose tax on the principal taxpayer on the ground that the difficulty in imposing the joint tax liability arises is the end.

In addition, Article 53(1) of the former Inheritance Tax and Gift Tax Act provides that a certain amount shall be deducted based on a certain relationship between the donor and the donee. However, it accords with the principle of equity to the taxpayer who retains data on such matters to bear the burden of proof. If such proof is not made by the taxpayer, the gift tax shall be imposed without the application of the above provision on deduction, and such result may not be deemed unreasonable in light of the equity of taxation. Therefore, the Plaintiff’s above assertion is without merit.

○ Part 8 of the first instance court’s decision that “no circumstances exist” added the following:

(1) The plaintiff asserts that the price of the stock in this case should be calculated based on the weighted average amount of net profit and loss for the last three years per share of non-listed stocks. Thus, the plaintiff asserts that the profit and loss for non-listed stocks should not be calculated based on the weighted average amount of profit and loss for the last three years since 2006, which is not "the last three years" but "the last three years". However, the defendant calculated the value of the stock in this case based on the weighted average amount of net profit and loss for each share from 2003 to 2005, which falls under "the last three years" of the title trust of the stock in this case. However, in order to examine whether the flow of net profit and loss for the share in 204 continues, the profit and loss for non-listed stocks should be calculated based on the weighted average amount of profit and loss for each share in this case from 206 to 2008. The above argument by the plaintiff is without merit.

2. Conclusion

Therefore, the judgment of the first instance court is justifiable, and the plaintiff's appeal is dismissed as it is without merit.