[Request Number] Trial 2015 Suh 2029 ( February 17, 2016)

[C] Revocation of Additional Decision]

[Determination] In a case where a sale facility is leased according to trade practice, most cases of calculating rent for the building and the land annexed thereto are not calculated, but most cases of calculating rent for the center of the building. The key place of business is the construction of a separate lease contract for the land. The key place of business is the construction of ○○○ on the land in the state of the site and so there is no example of sale or lease, so the market price is unclear. Therefore, it would be reasonable for the applicant corporation to take the average appraisal value of two appraisal corporations without distinguishing the building and the land as rent. In light of social norms and customs, it is difficult to view that it is not a normal transaction price to be established by a reasonable economic person, and thus, the instant disposition of this case imposed on the applicant corporation is erroneous.

[Related Acts] Article 29 of the Value-Added Tax Act

[Reference Decision] High Court Decision 2007Na5117

[Decision following Decision] The High Court Decision 2017Du320/ High Court Decision 2017Du3342

On January 14, 2015, the imposition of value-added tax on the second term portion for the year 201, the first term portion for the year 2012, the second term group for the year 2012, the first term group for the year 2013, the second term group for the year 2013, the second term group for the year 2013, and the first term group for the year 2014 shall be revoked.

1. Summary of disposition;

A. On June 2, 2006, the applicant entered into an agreement on the private capital inducement project with the OO on the part of the applicant corporation to use and profit from the 194,874 square meters of land, such as miscellaneous land, etc. for 6 lots outside the OO of Seoul Special Metropolitan City, which is a land necessary to build the OOO in the international application company, for 194,874 square meters of land for 20 years from the OO, and paid the annual land use fee to the OO by the amount obtained by multiplying the consumer price index change rate by the OO won.

B. On December 30, 2011, the applicant completed the OOO as a share investment ratio of 84%, 5%, and 11% with the OO corporation (hereinafter “OOO”) and the OOO, and entered into a lease agreement with each of the following items: (a) the building 49,820.7 square meters and the land 34,960.4 square meters (18% of the total land area; (b) the building combined with the building; and (c) the rent for each of the following taxable periods: (a) the applicant entered into a lease agreement with the OO on December 30, 2012 and the OO (the average appraisal value of the two appraisal institutions; (b) the land cost; (c) the building cost; and (d) the value-added tax on each of the annual rent for the use of the OO; and (c) the return and payment of each of the rent for each taxable period.

C. On the other hand, the disposition agency recognized the appraised value of the portion of the building among the rent for the key place of business, denied the appraised value of the portion of the land, and deemed the market value of the re-listed value based on the annual rent paid by the initial applicant corporation to the OO, and deemed the leased value of the land at a price lower than the market value of the key place of business to the OO, which is a related party, on January 14, 2015, the disposition agency corrected and notified the amount of the value-added tax on the difference between the market value and the key rent for the second period of the year 2011, the first period of the year 2012, the OO value-added tax, the second period of the year 2012, the first period of the year 2013, the OO value for the second period of the year 2013, and the OO value for the first period of the year 2014.

D. The applicant filed an appeal on April 13, 2015.

2. Opinion of the requesting corporation and the disposition agency;

A. The claimant corporation's assertion

In determining the market price under the tax law, in cases where there are generally traded prices with many and unspecified persons who are not related parties or third parties who are not related parties in a situation similar to the transaction, the price shall be based on such prices, but where it is not applicable due to unclear prices, the appraisal values of the appraisal corporation shall be applied pursuant to Article 89 (2) of the Enforcement Decree of the Corporate Tax Act

In calculating the reasonable rent for the area (land and buildings) used in excess of OOO, the applicant corporation did not have rental prices such as shopping mallss which are continuously traded with many and unspecified persons in a similar or neighboring area or lease prices such as shopping malls which are generally traded with third parties who are not specially related parties. Therefore, the appraisal and assessment institution also stated that the appraisal and assessment institution conducted an appraisal for the calculation of rent for shopping mall buildings at the market price, and the appraisal and assessment institution did not apply the rental comparison method to determine that there is no general case of similar conditions in a similar area, and instead applied the rental comparison method to determine that there is no case of similar conditions in a similar area, and calculated the rent by applying the reasonable calculation method by multiplying the expected interest rate by the value of the objects to be lower, and the expected interest rate is also calculated after premised on the purpose of the business site's use as shopping mall.

In light of the appraisal value of land rent between the claim corporation and the OOO, the disposition agency has expressed that the total amount of rent of the land used at the time of the lease contract for the controversial land, which is a natural green belt between the claim corporation and the OOO, and the rent of the building appraised for the shopping mall when the lease contract between the claim corporation and the OOO is the market price of the controversial rent, but the purpose of the lease contract for the controversial workplace is not divided into the land and the building, and it is natural that if the sale facility is leased, the use of the land is not accompanied by the use of the land and the land is not a separate lease contract for the additional lease of the land. Therefore, it is inappropriate to separately determine

On the other hand, the leased object between the claimant corporation and the OOO is the key land in the state of a site. On the other hand, the leased object between the claimant corporation and the OOO is the main place of business, and the lease transaction between the claimant corporation and the applicant corporation and the OOOO is not subject to comparison in principle, and there is no basis for the agency's opinion that the lease transaction between the claim corporation and the applicant corporation and the OOO is applied as a transaction example under a situation similar to the lease transaction between OO, and the related tax Tribunal's prior decision (the same purport is the same as the other majority of June 30, 201) is generally related to the land whose individual nature is very strong, the price of the land can vary depending on its land category, location, quality, etc., and even if there is a transaction example of other land divided in the same lot number, if the situation is different, it cannot be assessed as the market price of other divided land.

In addition, the Supreme Court precedents (Supreme Court Decisions 95Nu13296, Feb. 14, 1997; 2013Du10335, Sept. 21, 2013) held that in case where it is deemed that a comprehensive transaction of various assets is made in the application of the provision that is the unfair calculation method, in principle, it shall not be determined whether the transaction price and market price of each individual asset is high-value acquisition, etc. compared with the overall transaction price and market price of the assets, but it shall be determined whether a comprehensive transaction constitutes high-value acquisition, etc. as a whole compared with the overall transaction price and market price of the assets. In addition, when a lease transaction between a claimant corporation and an OOO-type is made, it shall be determined whether a building and its appurtenant land are the unfair calculation register by considering the building and its appurtenant land as the whole lease transaction, and it shall not be determined

Therefore, it is not reasonable that the disposition agency separates the land and buildings from the market price in calculating the market price of the business site at issue, and thus, the disposition of this case should be revoked.

(b) Opinions of disposition agencies;

The claimant corporation's payment of the land use fee for the total area of the commercial site, including the land at issue from OOO in 201, request for OO's payment, calculation and notification of the land use fee in 2012, notification of the land use fee in 2013, notification of the land use fee in 2013, correction notification of the land use fee in 2014, and OO's electronic tax invoice issuance of the requested corporation is confirmed by the contents of the electronic tax invoice issued by the non-specially related party. It is reasonable to apply the market price prior to the appraised value because there is a value falling under Article 89 (1) of the Enforcement Decree of the Corporate Tax Act.

The claimant corporation, in principle, should calculate the rent as an aggregate building by the rent comparison method pursuant to Article 22 of the Regulations on Appraisal without dividing land and buildings, but on the ground that it is difficult to capture the rent, the total sum of the land and buildings calculated by dividing the land and buildings by using the hostile method among the appraisal techniques is the reason that the land rent is low by the claimant corporation was reflected in the first to the Korea Airports Corporation and the fifth to the underground floor. However, when the claimant corporation pays the land rent to the OO, it is confirmed that the claimant corporation pays the land rent for each investment share regardless of the total amount of rent, use, number of floors, etc., which corresponds to the market price of the appurtenant land for the 5% share ownership of OOOOOO.

Therefore, it is reasonable that the disposition agency separately applies the market price separately from the land and buildings in calculating the market price of the rent for the key business place.

3. Hearing and determination

A. Key issue

The propriety of the disposition imposing the value-added tax on the difference, deeming that the applicant corporation leased land attached to the building to a specially related person;

B. Relevant statutes

(1) Value-Added Tax Act;

Article 29 (Tax Base) (4) Notwithstanding paragraph (3), in any of the following cases, the market price of goods or services supplied to a specially related person shall be deemed the market price of such goods or services supplied:

1. Where any payments for the supply of goods are made unfairly low or no payments are made;

(9) Where a business operator supplies land, buildings or structures, etc. attached thereto together, the actual transaction value of such buildings, structures, etc. shall be the value of supply.

(2) Enforcement Decree of the Value-Added Tax Act

Article 62 (Standards for Market Price) The market price referred to in Article 29 (3) and (4) of the Act shall be as follows:

1. Price of a continuous transaction between a person who is not a specially related person and a third party in a situation similar to the transaction concerned;

2. The price of goods or services received in compensation by an entrepreneur, if there is no price prescribed in subparagraph 1 (referring to the price of goods or services continuously traded between a person who is not a specially related person and a third party in a situation similar to the relevant transaction).

3. Where no price under subparagraph 1 or 2 exists or the market price is unclear, the price under Article 98 (3) and (4) of the Enforcement Decree of the Income Tax Act or Article 89 (2) and (4) of the Enforcement Decree of the Corporate Tax Act.

(3) Enforcement Decree of Corporate Tax Act

Article 89 (Scope, etc. of Market Price) (1) In applying Article 52 (2) of the Act, if the relevant corporation has a generally traded price continuously with many and unspecified persons other than specially related persons or a third party who is not a specially related person in a similar situation to the relevant transaction, the price (if a stock-listed corporation trades stocks issued by a stock-listed corporation on the Korea Exchange, the market price of the

(2) In applying Article 52 (2) of the Act, where the market price is unclear, the amount calculated by applying the following order in the following order:

1. Where there is a value appraised by the appraisal evaluation corporation under the Public Notice of Values and Appraisal of Real Estate Act, the value thereof (in case there are not less than two appraised values, the average amount of the appraised values): Provided, That this shall not include stocks, etc.;

C. Facts and determination

(1) According to the review data presented by the applicant corporation and the agency, the following facts are revealed.

(A) Article 17 of the concession agreement for the private capital inducement project concluded on June 2, 2006 by the claimant corporation, the corporation, the corporation, and the OOO entered into on June 2, 2006 states that the project implementer shall pay at the request of the OO once a year by adding the value-added tax prescribed in the annual estimate for payment of land use fees (OO) and the land use fees during the operation period shall be paid to the OO by the amount calculated by multiplying the annual rent for the immediately preceding year by the consumer price fluctuation rate.

(B) The key workplace lease agreement concluded on December 7, 201 by the applicant corporation and the OOO entered into on December 7, 201 is a sales facility, and there is no separate provision of the contract on the part of the land. The monthly rent paid by OO to the applicant corporation is the amount calculated by multiplying the construction cost corresponding to the leased object borne by the applicant corporation by the average interest rate per month of the applicant corporation.

(C) The comparison table between the disposition office for the issue place of business and the applicant corporation's rent is as follows.

OO

1) The rent calculated by the claimant corporation is the average amount of the appraisal value of the OOO (land OOO, building OO) and the OOO value of the OOO (land OOO, building OO).

2) The rent for the land at the key place of business calculated by the agency is the amount calculated by multiplying the rent for the land at issue (OO) paid by the applicant corporation to the OO by the ratio of the area used in excess (18%) of the OO.

(D) The status of the land at issue assessed by the said appraisal corporation is leased by OO by the requesting corporation is as follows.

OO

(E) On June 26, 2006, the minutes of the board of directors meeting (Report on the execution of the private capital inducement project) (Report on June 26, 2006, the user fee of the land in question is the level of OO or OOO, and the estimated price is reflected in the project value for the next 20 years.

(2) Comprehensively considering the facts and relevant laws and regulations, the disposal agency recognizes the appraisal value of the building for the purpose of calculating rent for the issue of the business site. The opinion that the appraisal corporation considers the annual rent for the land paid to the OO as the market price and applied the appraisal value lower than the market price is the object of wrongful calculation. However, the method of wrongful calculation can be said to be the case where it is deemed that the reasonable transaction between the related parties can not be deemed to take place in light of social norms or customs and that the tax burden is reduced unfairly (see, e.g., Supreme Court Decision 91Nu7637, Jan. 21, 192). If it is deemed that various assets are comprehensively transferred, it is difficult to determine whether the rent for the land is transferred at a low price as a whole compared to the market price for each individual asset, and thus, it is difficult for the appraisal corporation to reasonably calculate the rent for the land that is located at the market price of the building and the land subject to unfair appraisal by the general public.

Therefore, it is judged that the disposal agency erred in imposing the value-added tax on the applicant corporation by applying the unfair calculation method provision to the key rent.

4. Conclusion

This case shall be decided in accordance with Article 81 and Article 65 (1) 3 of the Framework Act on National Taxes because the petition for the trial results is well-grounded.