early 2010 Heavy372 ( October 28, 2011)

It is difficult to recognize that the previous farmland was directly cultivated for not less than three years.

Considering the fact that there were wage and salary income in the company after the acquisition of previous farmland, the fact that most of the farming work appears to have been carried out by the commission, etc., it is difficult to recognize that the previous farmland was cultivated by 1/2 or more of the farming work as at the time of transfer of previous farmland for three years or longer.

2011Guhap9967 Disposition rejecting capital gains tax reduction or exemption

Park XX

port of origin

December 2, 2011

January 16, 2012

1. The plaintiff's claim is dismissed.

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

The Defendant’s disposition of imposition of KRW 120,035,760 for the Plaintiff on May 4, 2010 shall be revoked.

1. Details of the disposition;

A. On January 20, 2004, the Plaintiff acquired and owned at KRW 334 million, and transferred KRW 791,118,000,00 for sale by voluntary auction on April 30, 2009, the Plaintiff acquired at KRW 791,118,00,00 for the same 00,000 square meters and 215 square meters (hereinafter referred to as “the farmland of this case by combining the above land”).

B. Accordingly, on June 29, 2009, the Plaintiff filed a preliminary return on the tax base of capital gains tax following the transfer of the farmland in this case with the Defendant, and applied for reduction or exemption up to KRW 100 million, deeming that the said farmland constitutes an exemption from capital gains tax due to farmland substitute land under Article 70(1) of the former Restriction of Special Taxation Act (amended by Act No. 9921, Jan. 1, 2010; hereinafter “Special Taxation Act”).

C. After that, on April 14, 2010, the Plaintiff acquired the 000-0 m2, 1507 m2 (hereinafter “instant substitute farmland”) from Korea-Eup, Jung-do as substitute farmland.

D. However, the Defendant denied the application for reduction or exemption on the ground that the Plaintiff did not directly cultivate the instant farmland, and corrected the transfer income tax for the year 2009 to KRW 120,351,643, and paid and notified the Plaintiff KRW 120,305,760 by deducting the already paid tax amount (hereinafter “instant disposition”).

E. The Plaintiff dissatisfied with the instant disposition and filed an appeal with the Tax Tribunal on July 29, 2010, but was dismissed on March 28, 2011.

[Ground of Recognition] A: Evidence No. 1-2 (No. 10, 11, and 10; hereinafter the same shall apply), Evidence No. 5, Evidence No. 8-1 through 3, and Evidence No. 10-1. 2, Evidence No. 11-2, and the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The Plaintiff, who acquired the instant farmland and was directors of 000-0 AA Village AA apartment of 000 dong AA, which was adjacent thereto, from November 10, 2004 to April 30, 2009, who were transferred by voluntary auction from around the time of November 10, 2004, cultivated directly the said apartment (However, an apartment house of 000 dong 000 dong 5, 2008) for a period of five years and three months, which was transferred by voluntary auction (on November 5, 2008).

In addition, on March 23, 2010, when the farmland of this case was transferred, the substitute farmland of this case was newly acquired on March 23, 2010, and it was directly cultivated by transferring it to 000-0, Dong Dong-dong, Jung-dong, Dong-dong.

Therefore, the Plaintiff’s income from the transfer of the farmland of this case is to be subject to reduction of capital gains tax due to substitute farmland of Article 70(1) of the Restriction of Special Taxation Act, but the Defendant’s disposition of this case based on a different premise

B. Relevant statutes

The entries in the attached statutes are as follows.

C. Determination

(1) According to Article 70(1) of the Restriction of Special Taxation Act and Article 67(1) and (3)1 of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 22037, Feb. 18, 2010; Presidential Decree of the Restriction of Special Taxation Act; hereinafter “Enforcement Decree of the Restriction of Special Taxation Act”), where a person who directly cultivated while residing in a location of previous farmland for at least three years due to necessity for cultivation has acquired another farmland within one year (two years after purchase by consultation) from the date of transfer of the previous farmland and resided in a new location of farmland for at least three years, and where the area of new farmland to be acquired is at least half of the area of farmland to be transferred or a third of the value of the transferred farmland is at least a third of the value of the farmland, the tax amount equivalent to 10/100 of the transfer income tax on the income accruing from substitute farmland shall be reduced

The purport of the above provision is to allow and guarantee free substitution of farmland to protect farmers, or to develop and encourage agriculture. Therefore, the acquisition and sale of farmland after the acquisition of farmland should be limited to the case where the land owned by self-employed farmer is to substitute land for the purpose of cultivation. Therefore, the requirements for reduction or exemption of capital gains tax due to substitute land for farmland shall be farmland. ① The previous land and new land shall be farmland, ② the previous land and new land shall be cultivated directly while residing in the previous location for not less than three years and in addition, for not less than three years, they shall be cultivated directly, and ③ their residence and cultivation shall begin within one year (or two years) from the date of transfer of the previous land, ④ The period between the previous land transfer date and the acquisition date of the newly acquired land shall be within one year (or two years). ⑤ The newly acquired farmland area shall be more than 1/2 of the farmland area transferred or more than the value of the transferred farmland shall be more than 1/3 (see, e.g., Supreme Court Decisions 95Nu3695, Sept. 29, 2005).

In addition, with respect to the meaning of direct cultivation under Article 70 (1) of the Restriction of Special Taxation Act, Article 67 (2) of the Enforcement Decree of the Restriction of Special Taxation Act clearly provides that "a resident is engaged in cultivating crops or growing perennial plants on his own land or growing or growing at least 1/2 of the farming work with his own labor." The court should interpret the meaning of "one half or more of the farming work" and determine whether he directly cultivates the farmland as the meaning of "self-working work". The fact of self-Cultivating the farmland must be proved by the claimant (see, e.g., Supreme Court Decisions 94Nu96, Oct. 21, 1994; 2010Du8423, Sept. 30, 2010).

(2) Whether the instant farmland satisfies direct farming requirements

There are evidence that the Plaintiff directly cultivated the farmland of this case, and there are evidence Nos. 3 (Evidence No. 10-9, Evidence No. 11-10, evidence No. 9, evidence No. 15 through 18, evidence No. 21, and evidence No. 1-2 (Evidence No. 10-11, hereinafter the same shall apply), evidence No. 1-1-2 (Evidence No. 10-11, 12-4, evidence No. 5-1 through 5, evidence No. 6-1 through 5, and evidence No. 6-1 through 5, and evidence No. 1-1 of this case’s testimony of this case is insufficient to acknowledge the Plaintiff’s direct cultivation in light of the following circumstances, and there is no other evidence to acknowledge it.

In other words, considering the following facts: ① the Plaintiff’s 20th day after acquiring the farmland of this case was difficult to recognize that the Plaintiff had been using the farmland of this case 20th day from November 22, 2004 to May 31, 2008 at △△△△ (2004, △△△ 2008, 2005, YY-dong) and the 20th day from the 20th day from the 20th day from the 20th day from the 19th day from the 205th day from the 20th day from the 206th day from the 20th day from the 20th day from the 206th day from the 20th day from the 20th day from the 206th day from the 20th day from the 20th day from the 206 day from the 20th day from the 20th day from the 206 day from the 3rd day from the 206th day from the 3rd day from the 3rd day from the 3rd day.

(3) Whether the substitute farmland of this case satisfies the requirements for cultivation (whether this part is included in the grounds for disposition of the defendant, but it is unclear whether this part is included in the grounds for disposition of the defendant, and it is also judged as one of the grounds for

(A) As seen earlier, the interpretation of the provision that reduces capital gains tax on the farmland substitute land for three years or more shall be interpreted as having to begin at least within one year from the date of transfer of previous farmland, except in extenuating circumstances (see, e.g., Supreme Court Decision 2002Du5924, Sept. 5, 2003).

However, according to Gap evidence No. 14, the plaintiff completed the move-in report from July 23, 2010, which was the location of the substitute farmland of this case, to 00-0, Dong-dong, Dong-dong, Dong-dong, Dong-dong, which was the location of the substitute farmland of this case, on April 30, 2009, when one year and three months elapsed since the transfer date of the farmland of this case, and therefore, it is reasonable to deem that the plaintiff did not start the move-in report within one year from the transfer date of previous farmland.

As to this, the Plaintiff asserted to the effect that from March 23, 2010 to December 31, 2010, the Plaintiff started to cultivate crops directly while moving into the KRdong 000-0 of the above Dong Dong Dong-dong, but only the moving-in report was delayed. However, in light of the fact that the Plaintiff, who is recognized as having added the entire purport of the pleading to the entries in the evidence No. 6-6 of the Dong Dong Dong Dong Dong Dong-dong Dong Dong-dong Dong-dong Dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-si, entered AA Electronic Co., Ltd. in Suwon-si-si from July 12, 2010 to December 31, 2010, there is no evidence to prove otherwise.

Therefore, insofar as the Plaintiff did not commence residence at the seat of the instant substitute farmland within one year from the date of transfer of the instant farmland, income from the transfer of the said farmland cannot be said to be the reduction or exemption of capital gains tax due to the substitute farmland under Article 70(1) of the Restriction of Special Taxation Act.

(B) Furthermore, even if examining whether the Plaintiff directly cultivated the substitute farmland of this case, there is no evidence corresponding thereto other than the evidence No. 13, and as seen earlier, the Plaintiff started to work in the AAE Co., Ltd. located in Suwon-si from July 12, 2010 even after acquiring the substitute farmland of this case located in Jung-si. It is difficult to view that not only the distance between Jung-Eup and Suwon-si, but also the land category of the substitute farmland of this case, unlike the previous farmland of this case, is the land category of which is 36 years of age, and not the occupational concentration in Suwon-si, but also the Plaintiff directly cultivated the substitute farmland of this case

(4) Therefore, the Plaintiff is deemed to have failed to meet the requirements for reduction and exemption of capital gains tax due to the substitute land of farmland. Therefore, the Defendant’s disposition of this case on the same premise is lawful.

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit. It is so decided as per Disposition.