Cho Jae-2016-Gu-336 ( November 02, 2016)

money deposited in the account shall be deemed to have been donated.

Since the money deposited in the Plaintiff’s account is deemed to have been reverted to the Plaintiff by using the Plaintiff’s business fund and real estate acquisition fund, it is reasonable to deem that the Plaintiff was donated.

Article 2 (Gift Tax Taxables) of Inheritance Tax and Gift Tax Act

2017Guhap20127 Revocation of Disposition of Imposition of Gift Tax

○ ○

○ Head of tax office

August 22, 2017

September 19, 2017

1. The plaintiff's claim is dismissed.

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

Cheong-gu Office

The Defendant’s disposition of imposition of gift tax amounting to KRW 496,706,40 against the Plaintiff on June 1, 2016 shall be revoked.

1) The phrase " June 16, 2016" appears to be a clerical error in the text of the claim, " June 1, 2016."

1. Details of the disposition;

A. On June 4, 2002, the Plaintiff’s her husband held a title trust of 1/2 shares out of 89,473 square meters of ○○○-Eup’s forest land (hereinafter “Osan 21-1 shares”). On September 22, 2006, the Plaintiff’s her her her 6,612/89,473 shares of the above land in KRW 650,000,000. On the other hand, the Plaintiff borrowed KRW 350,000,000 from Kim○○○ as collateral except the above transfer shares, and on September 29, 2006, Kim○-○ deposited the above transfer proceeds and the loan amount in total with the account of her her 1 billion won.

B. On September 29, 2006, KRW 15 million in cash, KRW 985 million in checks, and KRW 965 million in each of them was deposited into the Plaintiff’s Nonghyup Bank’s account on the same day, and KRW 96.5 million in each of the said KRW 10 million was deposited into the Plaintiff’s Nonghyup Bank’s account on the same day. The said KRW 10 million check was endorsed by Kim B/L and Seo-○○○, respectively, and the check endorsed by ○○○○ was deposited into the account in the Plaintiff’s spouse’s name.

C. On June 20, 2014, Pap○ filed a lawsuit against the Defendant seeking revocation of the disposition imposing capital gains tax on the Daegu District Court. On August 26, 2015, the said court rendered a judgment that the said disposition imposing capital gains tax on the premise that the actual owner of the relevant land was the Plaintiff’s owner and thus, revoked the said disposition (hereinafter “previous judgment”).

D. Based on the above judgment, the Defendant: (a) deemed that the Plaintiff’s father donated KRW 1 billion to the Plaintiff; and (b) rendered a disposition imposing gift tax of KRW 513,374,400 on the Plaintiff on June 1, 2016.

E. On August 26, 2016, the Plaintiff filed an appeal with the Tax Tribunal on August 26, 2016, but the said appeal was filed.

on November 2, 2016, the Board rendered a decision to dismiss the above claim.

F. On July 13, 2017, the Defendant: (a) determined and notified that the gift tax amount of KRW 16,68,00 should be deducted from the gift tax amount of KRW 25,00,00,000 (hereinafter referred to as “instant disposition”; and (b) determined and notified that the remaining portion of the gift tax amount of KRW 16,68,00,000,000,000 (1 billion - 25,000,000,000) should be deducted from the gift tax amount of KRW 16,68,00,000.

Facts that there is no dispute over recognition, Gap evidence 1, 2, 19 through 21 (including branch numbers; hereinafter the same shall apply), Eul evidence 1 and 2, and the purport of the whole pleadings.

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

1) The Plaintiff’s reference did not engage in financial transactions and real estate transactions in his/her own name without having to conduct financial transactions and real estate transactions in his/her name while running the business, such as real estate development business, and conducted financial transactions with the Plaintiff by lending the Plaintiff’s name. Thus, the Plaintiff’s reference cannot be deemed to have donated the amount to the Plaintiff solely on the ground that the money related to the land was deposited

2) Around the time the key issue amount was deposited into the Plaintiff’s account, the said money was still used as the business fund for the Plaintiff’s business, and even if the said money was used for the acquisition of real estate in the Plaintiff’s name, it would be limited to KRW 761,00,000, which was recognized by the decision of the Tax Tribunal, and thus, deeming that the entire key amount was used for the acquisition of real estate in the Plaintiff’s name is contrary to the principle

3) On September 29, 2006, KRW 1 billion deposited by Kim○○○○, was divided into KRW 15 million in cash and KRW 985 million in check, and withdrawn as a check. KRW 985 million in face value and KRW 165 million in check were withdrawn in two copies of check, and KRW 965 million in face value and KRW 10 million in face value and KRW 965 million in two copies of check. Of which, 965 million in face value and KRW 965 million, the check was withdrawn.

Only the original check has been deposited into the Plaintiff’s account, and the remainder 10 million won check has been endorsed by Kim Il-young and Seo-○ as an endorser respectively. The money not deposited into the Plaintiff’s account cannot be deemed as a donation to the Plaintiff, and the instant disposition is unlawful due to the above circumstances.

B. Relevant statutes

The entries in the attached Table-related statutes are as follows.

(c) Fact of recognition;

1) Around 1977, on the start of the bicycle repair business, construction machinery business, soil business, heavy business, etc. up to 199. The Plaintiff used Internet PC, manufacturing business, real estate business, etc., and the specific business history is as listed below.

2) On December 28, 2006, the Plaintiff purchased 13223/89473 shares of each land of ○○○○○○○-ri, Si-si on December 28, 2006 (hereinafter referred to as “○○○-ri land”). On the following day, the Plaintiff completed the registration of ownership transfer based on the above sale. The total transaction value of the above land purchased by the Plaintiff is KRW 740,90,000.

3) Meanwhile, on May 9, 2006, KRW 270,000 and KRW 273,529,960 were collected from each of the deposit accounts in the name of ○○○○○○. On the 12th day of the same month, the Plaintiff used KRW 180,000,000 as security deposit and construction cost, and on June 9 of the same year, used KRW 270,00,000 as security deposit and construction cost.

Facts that there is no dispute over recognition, the evidence mentioned above, each entry in the evidence Nos. 3 and 4, and the purport of the whole pleadings.

D. Determination

1) In a lawsuit seeking revocation of a disposition imposing gift tax, as long as the deposit in the name of a person recognized as a donor by the tax authority is revealed to have been withdrawn and deposited in the account in the taxpayer’s name, such deposit shall be presumed to have been donated to the taxpayer. Thus, if there are special circumstances, such as withdrawal of such deposit and that deposit in the taxpayer’s name is made for

The necessity of proof is the taxpayer (see Supreme Court Decision 96Nu3272 delivered on February 11, 1997).

2) Comprehensively taking account of the overall purport of the Plaintiff’s pleading, i.e., the title trustor and the actual owner of the above land. As such, the total amount of KRW 1 billion is the money reverted to the Plaintiff’s account and the Plaintiff’s spouse’s account; ② as seen earlier, the Plaintiff purchased a number of lands worth KRW 740,000,00 from the time when the issues were deposited into the Plaintiff’s account and the Plaintiff’s spouse’s account; and the Plaintiff did not have any particular income other than the issues at issue; and (3) considering the Plaintiff’s age that was 20,000, it is more difficult to view that the Plaintiff provided funds for the above purchase price and the business operation fund as 00,000 won for the Plaintiff’s account; and (4) the Plaintiff appears to have used the money for 200,000 won as 60,000 won for each of the above issues and 60,000 won for the Plaintiff’s account.

3. Conclusion

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