Where a corporation closes its business ex officio after stock donation, the calculation of value of donated property

Even if the value of donated property has rapidly diminished after donation, calculation of the value of donated property shall be determined at the time of donation, not at the time of imposition of gift tax

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

1. The plaintiff's claim is dismissed.

2. The costs of lawsuit shall be borne by cost;

The Defendant’s disposition of imposition of KRW 1.876 billion on June 1, 2006 against the Plaintiff shall be revoked.

1. Details of the disposition;

A. Kim ○ is the actual private interest and representative director of ○○○ Korea Co., Ltd. (hereinafter “instant company”) whose purpose is the light power metal business. While Kim ○ was working as the vice president of the ○○ Company (hereinafter “○○ Company”) that operated the Kim ○○ as the actual owner, the Plaintiff retired from office, and sold 720 million won out of the treasury shares owned by the instant company at KRW 360 million, but the sales price was to be paid until December 31, 2003.

B. According to the corporate register of the company of this case, the plaintiff was appointed as the representative director of the company of this case on August 11, 2000, and on the same day, the change of entry was made according to the contents of the share sales contract.

C. On June 1, 2006, the Defendant: (a) applied Article 41-2(1) of the Inheritance Tax and Gift Tax Act (amended by Act No. 6780, Dec. 18, 2002; hereinafter referred to as the “Act”) to the Plaintiff, on the ground that “The Gimgin-si actually owned 72,00 shares of the instant company; (b) the value per share was KRW 65,000 (the addition of shares to the largest shareholder’s KRW 50,00,000).” (c) applied Article 41-2(1) of the Inheritance Tax and Gift Tax Act (hereinafter referred to as the “Disposition in this case”).

D. On February 1, 2007, the Plaintiff filed an objection against the Defendant and filed an appeal with the Tax Tribunal on February 1, 2007. On June 2, 2008, the Tax Tribunal rendered an assessment of the value of the shares held in title by Kim○-ro on the title trust on June 2, 2008, as the rate of increase in addition to 30/10 is not applicable, and the remainder of the appeal was dismissed. In accordance with the decision of the Tax Tribunal, the Defendant corrected the amount of KRW 756 million out of the initial amount to be paid.

[Ground of Recognition] Facts without dispute, Gap evidence 1, Gap evidence 6-1, 2, Gap evidence 8-1 through 3, Gap evidence 9-1, Gap evidence 10-1, Gap evidence 11, Gap evidence 12-1 through 3, Gap evidence 13, Eul evidence 13, Eul evidence 2, Eul evidence 2, the testimony of witness Kim ○, the whole purport of the pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The plaintiff asserts that the disposition of this case is unlawful and thus should be revoked for the following reasons.

1) A sales contract was unilaterally prepared by unilaterally stealing the Plaintiff’s name, and only entered in the register of shareholders, and there was no agreement on title trust between the Plaintiff and the Kim○-gi.

2) Even if the fact of title trust is recognized, Kim ○ was necessary to dispose of the shares held by the instant company under Article 342 of the Commercial Act and the Securities and Exchange Act, and there was a need to divide shares, such as that 30 or more shareholders should be registered as a requirement for the registration of venture business and the new registration to the KOSDAQ with respect to the instant company. As such, the Plaintiff et al. entered in the register of shareholders in the register of shareholders, and there was no possibility of actual outcome of tax avoidance or possibility of future occurrence through such title trust. Thus, Kim ○ does not have

3) Since the company was established for the purpose of the light metal business, the company in this case discontinued its business without paying any profit due to the change of government policies and discontinued its business operation on June 30, 2003. As of June 1, 2006, the company was ex officio closed on June 1, 2006, which was donated property, since there was no economic value for the shares of the company in this case, which were donated property, and thus, the

(b) Related statutes;

Article 41-2 (Presumption of Donation of Title Trust Property)

Article 47 (Taxable Amount of Gift Tax)

Article 94 (Scope of Transfer Income Tax)

Article 103 (Basic Transfer Income Deduction)

Article 104 (Tax Rate of Transfer Income)

Article 55 (Tax Rate of Corporate Tax)

(c) Fact of recognition;

1) Details of stock change of the instant company

A) On January 23, 1997, ○○○○○ Engineering Co., Ltd. (hereinafter referred to as “○○○ Engineering”) in which the instant company was established and invested 9.99% (5,69,85,000,139,977) of its capital (5.70,140,000), and on the following day of its incorporation, most of the shares (1,130,164 shares) were transferred to ○○○○ Foundation (hereinafter referred to as “○○○”). At the time of its commencement of business on February 1, 1997, 13.5 of its capital stock, 13.5 billion won (2,70,000, face value, 5,000 won) in total, 1,130,164 Shares (1,139,164%) in 1,300,300,300,300,301 shares owned by ○○○○○ (5,006,000.3) shares own shares).

B) In around 198, 1998, ○ Engineering and ○○ Company was in bankruptcy, the instant company acquired ○○ Engineering and ○○ Company’s shares 200,000 shares of the instant company (a total of 10 billion won, 74.1% of issued shares) held by each of the instant companies (a total of 10 billion won, 74.1% of issued shares) from ○○ Engineering and ○○ Company succeeded to ○○ Company’s obligation under the pretext of payment and satisfaction of claims against ○○ Company and Kim○ Aircraft. The shares owned by ○ Engineering decreased to 690,165 shares (Issuance shares).

C) Although ○○○○○ Company’s own stocks held by it were 140,062 shares for the maximum spouse, 148,315 shares for the head of the company and 200 shares for the head of the company and 30 shares for the total of 152,50 shares for 135,00 shares for the head of the company, 72,00 shares for the total of 129,00 shares for the head of the company, 20 shares for 20 shares for 20 shares for 200 shares for the head of the company’s 200 shares for the total of 30 shares for 20 shares for the head of the company’s 200 shares for the head of the company’s 200 shares for the head of the company’s 200 shares for the head of the company’s 300 shares for the head of the 200 shares for the head of the company’s 400 shares for the head of the company’s 20000 shares for each of the company’s shares (2004 shares).

D) The Plaintiff, regardless of his/her will, revoked the transfer of title to employees, such as Korea-Japan, upon receiving an objection from the employees such as Korea-Japan, to the said transfer of title to employees.

2) Operational relationship of the instant company

A) As the founder of the instant company and the de facto management owner, Kim ○ has arbitrarily determined and operated major management matters of the instant company, such as issuance and transfer of stocks between the instant company and ○ Engineering operated by ○○ enterprise and ○○ enterprise.

B) On August 11, 2000, 2000, ○○○ was at issue with credit due to the bankruptcy between ○○ Company and ○○ Engineering that ○○○○ Company operated by ○○○○, and the Plaintiff was appointed as the representative director of the instant company, but Kim○ was actually operating the instant company as the president of the instant company even after the Plaintiff’s inauguration. The Plaintiff worked daily at the instant company and performed his duties as the representative director according to the direction

3) Details of trading of shares of the instant company

A) Around January 200, 200, Kim○ sold 62,040 shares of the company’s own shares of this case to ○○, a non-listed stock company, at KRW 15,000 per share. The company, ○○, a stock company, sold this to 25 persons, including Kang Tae, KRW 50,00 per share (total amount of KRW 8,220, KRW 41,000 per share) and 30,00 per share to 2 persons, including Kim○, including KRW 30,00 per share (total amount of KRW 7,30, KRW 219,00 per share).

B) Even after dividing the shares of the instant company into its face value on August 2000, Kim ○○ sold 2,593,500 shares to ○○ et al. and 19 others, and granted 60,000 shares as debt repayment.

4) The financial status of the instant company as of 2000

At the time of 200, capital of the instant company was KRW 4,014,673,788 as capital, debt was KRW 891,927,917 as capital, and earned surplus was 514,673,788 as interest income, etc.

5) Other circumstances relating to the title trust of the shares of the instant company

A) At the time of the tax investigation regarding the instant disposition, the Plaintiff stated, “At the time of the entry into a title trust, at the time of the entry into a list of shareholders of at least 1 billion won in capital, at least 1 billion won in order to satisfy the conditions of at least 30 shareholders, Kim coo arbitrarily allocated and prepared shares in the process of preparing a list of shareholders with 30 shareholders in order to satisfy the conditions of at least 30 shareholders,” and “at the time of entry into a list of shareholders, there is an entry of each letter in the list of shareholders at the time of entry into an objection and at the intervals of cancellation and cancellation from the list of shareholders, and the next cancellation is cancelled.”

B) In the process of the tax investigation and this court stated that “The plaintiff does not have any fact that he participated in the preparation of the register of shareholders,” and that in the course of the tax investigation, the plaintiff stated that “the plaintiff was involved in the issuance of the certificates while entering the Financial Depository as the representative director,” and that “the transmitted director and the Park ○-tae will not have any fact that he participated in the preparation of the register of shareholders.”

C) During the tax investigation process, Songsan stated, “At the time, the instant company intended to register as a venture business, and had 30 or more shareholders registered as a condition to take measures to register on the KOSDAQ, and during this process, he voluntarily prepared the shareholders’ shares together with the Kim ○-un Chairman, Kim Yong-hun, Kim ○-ho President, and Park Jong-tae’s auditor.” “At the time of preparing a list by allocating the shareholders’ shares, he knew of the content of “(40,000 shares are listed as the shares of the shareholders).”

[Basis] Evidence Nos. 1, 6-1, 2, 7-1, 2, 8-1 (the same as evidence No. 3) through 3, Gap evidence No. 10-5, Gap evidence No. 11, 12-1 through 3, Eul evidence No. 12-1, 13, Eul evidence No. 1, 2, Eul evidence No. 4, evidence No. 4, evidence No. 7-1, evidence No. 8-1 (the same as evidence No. 3), and the purport of the whole pleadings

D. Determination

1) Determination on whether a title trust is held

A) The provision on deemed donation under Article 41-2(1) of the Act shall apply in cases where a real owner and a nominal owner enter into a registration, etc. in the name of the nominal owner by agreement or communication with respect to property requiring a registration, etc. for the transfer or exercise of rights. Therefore, in cases where a registration, etc. is made unilaterally by using the name of the nominal owner regardless of the nominal owner’s intent, it may not apply. In such cases, the tax authority must prove only that the real owner is different from the nominal owner, and the burden of proving that the registration, etc. of the nominal owner was made by a unilateral act of the real owner regardless of the intent of the nominal owner should be borne by the nominal owner who asserts such act (see, e

B) In light of the above legal principles, it is against common sense that the Plaintiff was unable to know about the change of ownership of the instant company’s shares, including the change of the company’s shares, as seen earlier, and especially the operation relationship of the instant company at the time of the establishment of the instant company, and in light of the circumstances where the Kim○ was arbitrarily transferred to the ○○ Engineering, etc. operated by the Plaintiff at his own expense, the actual owner of the instant company’s transfer in the future is Kim○. The following circumstances are as follows: ① the Plaintiff was working every day in the instant company in accordance with the direction of Kim○, and the Plaintiff was unable to know about the change of ownership of the instant company’s shares, such as the transfer of the instant company’s shares at par value. ② The Plaintiff did not know about the change of ownership of the instant company’s shares at the time of establishment of the instant company’s establishment, and ② the Plaintiff did not know about the change of ownership of the Plaintiff’s shares under the name of the Plaintiff’s transfer agent, regardless of its existence.

C) Therefore, this part of the Plaintiff’s assertion is without merit.

2) Whether the purpose of tax avoidance exists

A) The legislative purport of Article 41-2(1) of the Act is to recognize an exception to the principle of substantial taxation with the purport of effectively preventing the act of tax avoidance using the title trust system and realizing the tax justice. Thus, the application of the proviso of the same Article is possible only if the purpose of tax avoidance is not included in the purpose of the title trust, and in such a case, the burden of proving that there was no purpose of tax avoidance. Therefore, the burden of proving that there was no purpose of tax avoidance, other than the purpose of tax avoidance, can be proven by means of proving that there was no purpose of tax avoidance. However, the nominal owner who bears the burden of proving the burden of proof has a clear purpose that is not related to the tax avoidance to the extent that it is recognized that there was no purpose of tax avoidance in the title trust, and that there was no tax avoidance at the time of the title trust or at the time of the future, must be proven to the extent that there was no doubt in the ordinary person by evidence with objective and correct points that there was no tax avoidance in the

B) In light of the above legal principles, even if the purpose of the title trust was to register the instant company’s shares with the Plaintiff as a venture business and to satisfy the requirements for registering them in the KOSDAQ, the following circumstances, which can show the details of the sale and purchase of the instant company’s shares and the overall purport of the argument at the time of 2000 of the instant company’s financial situation, were as follows. In other words, Kim ○ was a large amount of capital gains by selling the instant company’s shares to the Plaintiff, etc. at a sale price exceeding the face value at the time of trust in the name of the instant company’s shares, and it was possible to expect the activation of the sale by issuing shares in a uniform standard. In light of the transfer income tax on the transfer of shares by an unlisted corporation under the Income Tax Act (20%) and the basic income deduction (2,500,000 won per annum for one person), corporate tax rate (16% per annum for 100 million won, and Kim 28% for the excess portion), and there was no evidence that the Plaintiff transferred the instant shares under its name or its own net profit.

C) Therefore, other Plaintiff’s assertion on this part is without merit.

3) Determination as to the value of the donated property

The value of donated property should be calculated as of the date of donation, not at the time of taxation (Article 47(1) of the Act). The value of the shares held in title by the Plaintiff should be deemed 50,000 won per share, which is the transaction price between 0,000 won and 25 persons, including 0,000 won, around that time, in light of the details of trading the shares of the instant company at the time of title trust as seen earlier, in particular, the number of the transaction subject and the trading volume. Accordingly, the Defendant’s disposition based on this premise is lawful, and the Plaintiff’

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.