Transfer of absentee-owned real estate and obligation to pay capital gains tax by absentee administrators.

In the case where the principle of substantial taxation can be applied, the transfer income refers to the case where the actual owner of real estate is different from the actual owner, and the administrator of an absentee cannot become a person liable for tax payment as capital gains because he/she cannot be the owner in any case. Thus, the absentee cannot be a person liable for tax payment as a person liable for capital gains. Moreover, the mere fact that the use of the sales price of real estate owned by the absentee is clearly made by the absentee manager, and it cannot be said that the actual owner of capital gains is a person liable for tax payment.

Articles 7 and 23 of the Income Tax Act, Article 14(1) of the Framework Act on National Taxes

Plaintiff

head of Sung Dong Tax Office

Seoul High Court Decision 82Gu947 delivered on October 14, 1983

The appeal is dismissed.

The costs of appeal shall be borne by the defendant.

We examine the grounds of appeal.

If evidence was collected through the records of the court below on May 30 of the same year from the Seoul Family Court, the plaintiff was originally owned by the non-party 1,740 forest in Nam-gu, Incheon. But after departure from the Republic of Korea on August 15, 198, he entrusted the management of this forest land and its ground buildings to the non-party 2, his father, who was the plaintiff's father, and managed them. After the plaintiff died on August 4, 1950, the non-party 1's administrator was appointed as the non-party 1's administrator of non-party 1's non-party 1's non-party 1's non-party 1's non-party 1's non-party 1's non-party 1's non-party 1's non-party 1's non-party 1's non-party 1's non-party 1's non-party 1's non-party 1's non-party 1's co-party 1's estate administrator.

According to the records of the case, the plaintiff's assertion that the forest of this case was donated by the above non-party 1 to the plaintiff's deceased non-party 2. However, the plaintiff's assertion as a means of attack and defense can be viewed as preliminary or selective. Thus, among the plaintiff's actual assertion, it cannot be viewed as an error of law on the ground that the plaintiff's actual assertion acknowledged that he managed the property by the appointment of an absentee property administrator and disposed of it with the permission for excess of authority.

Therefore, the Plaintiff, as an administrator of an absentee, sells the forest of this case with the permission of the court, and cannot be deemed as having acquired transfer income by selling it as the legal or de facto owner of the forest of this case. Article 7 of the Income Tax Act provides that income tax shall be imposed on a person who actually obtains income pursuant to Article 14(1) of the Framework Act on National Taxes if the ownership of income, profit, property, act, or transaction subject to taxation is merely nominal and there is another person to whom such income, profit, or transaction belongs. Article 14(1) of the above Framework Act on National Taxes provides that if there is another person to whom such income, profit, property, act, or transaction, which is subject to taxation, the tax law shall apply to the person to whom such income actually belongs, and accordingly, the principle of substantial taxation is declared by each of the above persons to whom the real owner of real estate belongs. Thus, where the principle of substantial taxation is applicable, the administrator of an absentee can not be deemed as a person to whom transfer income belongs even if it is no other person to whom it belongs.

The appeal is dismissed, or there is no reason to do so.

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Lee Il-young (Presiding Justice)