Early High Court Decision 2009Du3617 ( December 05, 2009)

Land donated by inheritance from a lineal ascendant;

Where the transferor has cultivated farmland donated to him/her by inheritance from the relevant lineal ascendant while his/her lineal ascendant resided in the location of land for not less than eight years, as the transferor directly cultivated, the period owned by the early mother in cases of the plaintiff deemed land for non-business use as land for non-business use is not included

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

1. The part which seeks revocation of the disposition of resident tax among the lawsuits of this case shall be dismissed.

2. The plaintiff's remaining claims are dismissed.

3. The plaintiff shall bear the litigation costs.

The imposition of capital gains tax of KRW 21,649,570 for the Plaintiff on July 1, 2009 and KRW 2,164,950 for the resident tax of KRW 21,64,50 for the year 2008 shall be revoked.

1. Details of the disposition;

A. On October 2, 2003, the Plaintiff: (a) donated ○○○○○○○, ○○, ○○○-si, 212-4, 699 square meters (hereinafter referred to as “point land”); (b) transferred the land to ○○○, ○○, and (c) transferred the land for public use on September 3, 2008 due to an agreement on the acquisition of the land for public use (registration of ownership on September 5, 2008).

B. On November 30, 2008, the Plaintiff: (a) deemed the land at issue as land for business and paid capital gains tax by applying the general tax rate; (b) however, the Defendant deemed the Plaintiff as land for non-business on the ground that the Plaintiff did not meet the requirements for re-resident and self-resident; and (c) rendered a disposition of imposition of capital gains tax of 21,649,570 won and resident tax of 2,164,950 won to the Plaintiff on July 1, 2009 by applying the heavy taxation rate.

C. The Plaintiff filed a request for a trial with the Tax Tribunal on September 23, 2009, upon filing an objection on August 21, 2009, but the request for a trial was dismissed on December 15, 2009.

[Ground of recognition] The evidence Nos. 1, 2, 3, Eul No. 1, and the purport of the whole pleadings

2. Judgment

A. Whether the lawsuit seeking revocation of the disposition imposing resident tax is legitimate

The defendant of an appeal seeking the revocation of the disposition imposing resident tax is the head of the relevant Si/Gun having jurisdiction over the place of payment of income tax (see Supreme Court Decision 2004Du11459, Feb. 25, 2005). As such, the part seeking the revocation of the disposition imposing resident tax among the lawsuit in this case against a person who is not qualified as the defendant is unlawful.

B. Whether imposition of capital gains tax is lawful

1) Claims and issues

The plaintiff asserts that the total holding period exceeds eight years as the plaintiff's mother holds 12 years and 4 months, and the plaintiff's additional 3 years and 5 months exceeds eight years. Thus, it is unlawful to regard the land as land for non-business use.

The key issue of this case is whether the land at issue is land excluded from non-business under Article 168-14 (3) 1-2 of the Enforcement Decree of the Income Tax Act.

2) Determination

As the Enforcement Decree of the Income Tax Act was amended by Presidential Decree No. 21195 on December 31, 2008, the provisions were added that the farmland directly cultivated by the relevant lineal ascendant while residing in the land location prescribed by Ordinance of the Ministry of Strategy and Finance for not less than eight years, as the transferor cultivated directly (Article 168-14 (3) 1-2 of the Enforcement Decree of the Income Tax Act) and Article 4 of the Addenda of the Enforcement Decree of the Income Tax Act at the time of the amendment, the amended provisions of Article 168-14 (3) of the Enforcement Decree of the Income Tax Act provide that the amended provisions of Article 168-14 (3) of the Enforcement Decree of the Income Tax Act shall apply from the transfer of the farmland to the taxable year belonging to the enforcement date of the Income Tax Act ( December 31, 2008). Thus, even in this case on September 3, 2008, the provisions

Meanwhile, under the principle of no taxation without law, the interpretation of tax laws and regulations shall be interpreted in accordance with the law, barring any special circumstance, and shall not be extensively interpreted or analogically interpreted without reasonable grounds. In particular, it accords with the principle of fair taxation with the principle of fair taxation to strictly interpret the provisions that can be clearly viewed as preferential provisions among the requirements for reduction and exemption (see, e.g., Supreme Court Decision 2003Du7392, May 28, 2004; Supreme Court Decision 2008Du11372, Aug. 20, 209).

According to Gap evidence Nos. 3, 4, and 5, the key land is that the plaintiff's Mamo KimB transferred (the ownership transfer registration on September 11, 1998) to the Komo-MamoCC on September 8, 1998. The UCC transferred the land to the plaintiff's Mamo-Ma (the ownership transfer registration on May 9, 200) on May 2, 200, and the most AA made a donation (the ownership transfer registration on October 2, 2003) to the plaintiff, who is the son on September 15, 2003 (the retention period of the AA is three years and five months). In light of the above legal principles, since Article 168-14 (3) 1-2 of the Enforcement Decree of the Income Tax Act applies to the land donated to the plaintiff, a lineal ascendant who was donated to the plaintiff should be limited to the pertinent land.

Therefore, it is legitimate that the Defendant imposed the transfer income tax of this case on the land for non-business use as long as the Plaintiff donated the key land in a state that the largestA does not meet the requirements for possession for not less than eight years, and the Defendant did not regard the key land as the non-business land.

3.In conclusion

Therefore, the part of the lawsuit of this case seeking revocation of the disposition imposing the resident tax, and the plaintiff's remaining claims seeking revocation of the disposition imposing the transfer income tax are dismissed as it is without merit.