Chuncheon District Court 2010Guhap496 ( October 24, 2010)

Early High Court Decision 2009J3696 ( December 18, 2009)

Whether forest land and forest trees are transferred separately;

The assertion that forest land and forest trees were transferred separately, but the sales contract does not contain any content on trees, and that the forest trees were transferred separately in view of the fact that the business registration for the forestry was not completed, is without merit.

(Chuncheon)Revocation of revocation of a disposition of refusal to revise capital gains tax

○ ○ Central Council

○ Head of tax office

Chuncheon District Court Decision 2010Guhap496 Decided June 24, 2010

1. The plaintiff's appeal is dismissed.

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

The judgment of the first instance shall be revoked. The defendant's rejection of correction of KRW 192,983,201 for the transfer income tax belonging to the year 2007 against the plaintiff on February 4, 2009 shall be revoked.

1. Details of the disposition;

As to this part, Article 8 (2) of the Administrative Litigation Act and the main sentence of Article 420 of the Civil Procedure Act cites paragraph (1) of the judgment of the first instance.

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The plaintiff transferred the above trees with the forest of this case while running a forestry business, such as cutting-up and growing-up, etc. in each forest of this case. Pursuant to Article 51(8) of the Enforcement Decree of the Income Tax Act, the part pertaining to the transfer of forest land among income from the above transfer should be subject to separate taxation as capital gains, and the part pertaining to the transfer of trees should be subject to separate taxation as business income. Thus, the disposition of this case rejecting the plaintiff's request for correction for separate taxation for the above separate taxation is unlawful.

B. Relevant statutes

As to this part, Article 8 (2) of the Administrative Litigation Act and the main sentence of Article 420 of the Civil Procedure Act cited Article 2 of the judgment of the first instance as it is.

C. Determination

Article 94(1)1 of the Income Tax Act provides that income generated from the transfer of land or a building shall be the transfer income, Article 19(1)1 of the Income Tax Act provides that income generated from forestry shall be the business income, and Article 51(8) of the Enforcement Decree of the Income Tax Act provides for the calculation method of the total amount of income in calculating the business income generated from the operation of forestry. Therefore, in order to impose separate taxation pursuant to Article 51(8) of the Enforcement Decree of the Income Tax Act, the transfer of trees shall fall under the forestry, that is, the business, and if not, the income from the transfer of trees shall be deemed included in the income from the transfer of land, and Article 94(1)1

In light of the fact that the sales contract (No. 7) prepared between the plaintiff and the non-party company with respect to each forest of this case only includes a special agreement on cemetery relocation, and it cannot be deemed that the plaintiff used the above trees as a separate trade object in the above sales contract, since there is no content as to trees on the ground, there is no other evidence to prove that the plaintiff had engaged in forestry, and there is no registration of a business operator in relation to the forestry, and the above trees are not registered or registered in accordance with the Act on Standing Timber, it is reasonable to view that the trees on each land of this case are not transferred in the course of operating the forestry business by the plaintiff, but as they are transferred with each forest of this case as part of the forest of this case, the forest of this case was not transferred in the course of running the forestry business, and the forest of this case was transferred as part of the land. Accordingly, the income from the transfer of trees also constitutes the object of taxation of capital gains tax following the transfer of each forest of this case.

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit, and the judgment of the court of first instance is just with this conclusion, and the plaintiff's appeal of this case is dismissed as it is without merit, and it is so decided as per Disposition.