Early High Court Decision 2009Du3632 ( December 15, 2009)

It is difficult to recognize the fact that the applicant does not meet the requirements for reduction and exemption of farmland on behalf of others.

In light of the fact that a pharmacist operates a pharmacy as a pharmacist, and a large sales occurred, and that a third party seems to have received rice income direct payments as a rice farmer, it is difficult to acknowledge such fact. Not only the newly acquired farmland area falls short of 1/2 of the transferred farmland area, but also the value falls short of 1/3 of the transferred farmland value, but also falls short of 1/3 of the transferred farmland value and does not meet the requirements

2011Nu11367 Revocation of disposition of imposing capital gains tax, etc.

OraA

The Director of Incheon Tax Office

Incheon District Court Decision 2010Gudan389 Decided January 27, 2011

November 2, 2011

December 7, 2011

1. The plaintiff's appeal is dismissed.

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

The first instance judgment shall be revoked, and the imposition of capital gains tax of 87,960, and 200 won on July 1, 2009 by the defendant against the plaintiff on July 1, 2009 shall be revoked.

1. Details of the disposition;

A. The Plaintiff acquired respectively as of May 7, 1997 the 000-0 m2,328 m2, and as of August 31, 2004, the Plaintiff acquired the 1,974 m2,000 m2,000 O-dong, Jung-gu, Incheon as of May 7, 1997 (the total area of the 4,302 m2 m2, hereinafter “the farmland”).

B. After that, the farmland of this case was expropriated in KRW 1,131,257, and KRW 100 in the future of Korea Land Corporation, etc. on December 13, 2007. On February 28, 2008, the Plaintiff reported the transfer income tax on the farmland of this case on February 28, 2008, and reported the transfer income tax by applying for reduction or exemption by farmland substitute land after filing a revised report on September 30, 2008.

C. The Defendant denied the Plaintiff’s application for reduction of farmland by deeming that the Plaintiff did not own the farmland in this case, and corrected and notified the Plaintiff of the transfer income tax of 87,960, and 200 won in July 1, 2009 (hereinafter “instant disposition”).

[Reasons for Recognition] Facts without dispute, Gap evidence 1, 10 (including virtual numbers; hereinafter the same shall apply), Eul evidence 1

2. Whether the disposition is lawful;

A. Summary of the plaintiff's assertion

Since the Plaintiff’s acquisition of the farmland in this case, he was self-employed for more than three years by directly cultivating rice farmers, etc. while employing a rice shed for farming purposes. The Plaintiff resided in the above location for more than three years prior to the expropriation of the farmland in this case, and acquired and cultivated large farmland within two years from the date of the transfer of the farmland in this case. Thus, the income from the transfer of the farmland in this case is subject to reduction of capital gains tax due to the self-employed farmland in Article 70 of the Special Cases Restriction Act, but the disposition in this case on the premise different from this is unlawful.

(b) relevant statutes;

It is as shown in the attached Form.

C. Determination

1) According to Article 70(1) of the former Restriction of Special Taxation Act (amended by Act No. 921 of Jan. 1, 2010), and Article 67(1), (2), and (3)1 of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 20620 of Feb. 22, 2008), in order to be subject to reduction of or exemption from capital gains tax by substitute farmland, ① previous land and new acquired land shall be farmland, ② direct cultivation shall be conducted while residing in the previous location of farmland for not less than three years and living in the new location of farmland for not less than three years, and ③ The period between the transfer date of previous land and that of new acquisition date of land shall not be more than one year (in cases of expropriation by consultation and compensation for land, etc. under the Act on Acquisition of and Compensation for Land, etc. for Public Works Projects, and no more than two years shall be included in the case of direct cultivation or transfer of farmland by a person who directly cultivates or transfers the farmland.

2) First, we examine whether the Plaintiff cultivated the farmland of this case, which is the previous farmland, under his responsibility and accounting for at least three years.

The Plaintiff, as a pharmacist, has been operating the FF FF pharmacy from around 1992. The annual sales from 2007 amount to 6.8 million won (Evidence B, No. 2, No. 3). Of the instant land, the Plaintiff appears to have received subsidies for rice income as he left YG from 000-0 from 2002 to 205, and the witness H of the first instance trial also testified corresponding thereto (Evidence B, No. 6 and new witness of the first instance trial). In light of these circumstances, evidence such as the Plaintiff’s annual sales from 2, No. 9, No. 12, and No. 15, No. 12, and No. 12 to 15, and the fact inquiry results on the witness of the first instance trial, the witness of the second instance trial, the witness testimony of the second instance, and the head of the second instance court, and the fact inquiry results on the Plaintiff’s internal farmland from the date of this case’s farming is insufficient to prove otherwise under his responsibility and calculation.

3) Furthermore, by December 13, 2009, the area of the farmland newly acquired until December 13, 2009, which was not later than two years after the date of expropriation of the farmland in this case, is at least 1/2 of the area of the farmland transferred, or at least 1/3 of the value of the farmland transferred. The Plaintiff’s acquisition of 00-00 00,000 square meters for 223,00,000 square meters for 223,00,000 won on October 8, 209, which was within two years after the date of expropriation of the farmland in this case, is recognized ( evidence No. 11, No. 15, No. 16), and the above acquisition of the newly acquired farmland in this case and the farmland in this case (the area of 4,302 square meters, 1,31,257,100 won) without satisfying the requirements for reduction or exemption in this case’s related Acts and subordinate statutes, there is no other evidence to acknowledge that the Plaintiff’s tax reduction or exemption.

3. Conclusion

The judgment of the first instance is justifiable. The plaintiff's appeal is dismissed.