Cho Jae-2017-China-1296 ( December 07, 2017)

The application of reduction and exemption shall have been carried out by a resident in the farmland for not less than eight years or have been cultivated or cultivated with his own labor not less than half of the farming work.

In order to be subject to the provisions of reduction and exemption, it shall be applicable to the farmland as of the date of transfer, and it shall be always engaged in the cultivation of the crops or the growing of perennial plants on the farmland owned by the resident for at least eight years or shall have been cultivated or cultivated with his own labor by more than half of the farming work

Article 69 of the Restriction of Special Taxation Act (Reduction or Exemption of Transfer Income Tax for Self-Cultivating Farmland)

2018Gudan392 Revocation of Disposition of Imposing capital gains tax

○ Kim

○ Head of tax office

2019.03.05

2019.04.09

1. All of the plaintiff's claims are dismissed.

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

Cheong-gu Office

The Defendant’s imposition of capital gains tax of KRW 71,090,276 (including additional taxes) against the Plaintiff on December 1, 2016 and the imposition of KRW 18,449,868 (including additional taxes) against the Plaintiff on February 14, 2018 and the imposition of KRW 2,459,982 (including additional taxes) against the Plaintiff on February 14, 2018.

1. Details of the disposition;

A. The Plaintiff’s father’s father, deceased KimA (hereinafter “the decedent”) acquired 3,152 square meters of land as indicated below the list Aa City/A Dong from 1969 to 1970. On April 27, 1994, the Plaintiff acquired 2/11 shares of the inherited land due to the death of the decedent, as listed below, and transferred it to the Korea Land and Housing Corporation on June 12, 2015.

B. Upon filing a preliminary return of capital gains tax on the instant land, the Plaintiff filed an application with the Defendant for reduction or exemption of capital gains tax on his/her own farmland for at least eight years pursuant to Article 69 of the former Restriction of Special Taxation Act (amended by Act No. 13560, Dec. 15, 2015; hereinafter the same).

C. On December 1, 2016, the Defendant issued a revised notice of KRW 91,86,220 and KRW 4,260,685 to the Plaintiff on December 1, 2016, by applying the reduction of capital gains tax on compensation by substitute land under Article 77-2 of the former Restriction of Special Taxation Act, deeming that the land at issue 4 is not farmland, but the land at issue 1-3 is not farmland, and that the decedent and the Plaintiff did not do so for at least eight years in total.

D. On December 7, 2017, the Tax Tribunal rendered a decision to re-examine whether the Plaintiff’s residence at the location of the instant land, thereby applying capital gains tax reduction or exemption on the land subject to purchase due to designation of a development restriction zone under Article 77-3 of the former Restriction of Special Taxation Act and dismissing the remainder of the petition for trial.

E. Accordingly, the Defendant conducted a reinvestigation, and confirmed that “the Plaintiff was residing in bb Si housing located within 30 km from the location of the instant land from the date of acquisition of the instant land until the date of sale,” and notified that “the Plaintiff shall be determined as KRW 71,090,276 (including additional taxes) and special rural development tax (including additional taxes) and KRW 4,428,808 (including additional taxes) by applying reduction or exemption under Article 77-3 of the former Act on Special Cases concerning Taxation, which is the amount of capital gains tax notified of the final decision on February 14, 2018, subtracting KRW 21,92,154, which is the amount of capital gains tax notified of the decision.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1 through 6, Eul evidence Nos. 1 through 4 (including branch numbers), the purport of the whole pleadings

2. Whether the disposition is lawful;

A. The plaintiff's assertion

The Plaintiff’s share of “1.7 26.7 m2 and 96.7 m2 and 75.1m2 at issue, excluding the leased portion of 31.8m2,” is not the reduction or exemption of capital gains tax (the amount equivalent to 40/100 of capital gains tax) on the land subject to purchase according to the designation of the development restriction zone under Article 77-3(1)1 of the former Restriction of Special Taxation Act, but the reduction or exemption of capital gains tax (the amount equivalent to 100/100 of capital gains tax) on the self-employed land under Article 69(1) of the former Restriction of Special Taxation Act is applicable to the Plaintiff. The decedent continued to acquire the inherited land, and 40 m2 and 80 m2, such as 10 m2 and 30 m2, the Plaintiff, after the death of the decedent, had cultivated various agricultural crops on the same day, including 10 m20 m2 and 8 m2010 m2.

B. Relevant statutes

It is as shown in the attached Form.

C. Determination

1) Relevant legal principles

The main sentence of Article 69(1) of the former Restriction of Special Taxation Act provides that "income accruing from the transfer of land prescribed by Presidential Decree, among land directly cultivated for not less than eight years by a resident residing in the seat of farmland, shall be reduced by 100/100 of capital gains tax." In addition, under Article 66(5) and (13) of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 26922, Jan. 22, 2016; hereinafter the same shall apply), the said provision shall apply to farmland as of the transfer date, and it is reasonable for a resident to have been engaged in the cultivation of crops or perennial plants in his own farmland for not less than eight years, or who is engaged in the cultivation or cultivation with his own labor for not less than 20 percent of capital gains tax (see, e.g., Supreme Court Decision 200Nu1270, Jul. 13, 1993; 20Da1271, Jul. 29, 20127).

2) Determination as to whether the decedent was "direct farming" for at least eight years

A) According to Article 69(1) of the former Restriction of Special Taxation Act and Article 66(4) and (11) of the former Enforcement Decree of the Restriction of Special Taxation Act, where a successor continues to cultivate the inherited farmland for at least one year, the period acquired and cultivated by the decedent shall be deemed as the period acquired and cultivated by the heir, and the reduction or exemption of the income tax on self-arable farmland shall be applied for at least eight years.

B) According to each of the statements in Gap evidence Nos. 7 through 9, Gap evidence Nos. 28-1 and 28-2 as to the instant case, it is insufficient to recognize that the above acknowledged facts alone are sufficient to recognize that the decedent cultivated or cultivated more than half of farming work with his own labor, and there is no evidence to acknowledge otherwise, on the premise that the decedent was self-employed for not less than 8 years, in light of the following circumstances: Gap evidence No. 6, Eul evidence Nos. 5 through 7, and Nos. 14, the deceased purchased a truck on December 28, 1984; however, considering the following circumstances, it is insufficient to acknowledge that the decedent cultivated or cultivated more than half of farming work with his own labor. Therefore, the plaintiff's assertion that the decedent was self-employed for not less than 8 years is without merit.

(1) From March 22, 1972, the decedent continued to reside in the above CCdong 27 until April 27, 1994, the decedent had been living in the above CCdong 27, and the inheritance land at the above residence requires one hour and 50 minutes due to public transportation, up to the inheritance land, and the vehicle route is 37.6km. The Plaintiff’s assertion that public transportation and road network had been located in the above distance every day by the decedent since 1970, when the decedent had been in bad weather and road network. It is more true in view of the fact that the decedent continued to engage in other income activities as seen below.

(2) 피상속인의 동생 김HH은 △△세무서에서 작성한 문답서에서 '피상속인은1967. 12. 결혼하고 바로 bb에 갔으며 bb cc동에서 □□□에 취직하여 직장생활을 하다가 부동산 중개업, 슈퍼, 연탄 소매일을 했다.'고 진술했다. 이는 피상속인의 처(원고의 모) 망 류BB이 작성한 진술서에 기재되어 있는 '1967년 결혼하고 2년 좀 넘게 시집살이를 하고 남편의 직장이 있는 bb시 cc동에 살림을 차렸다. 남편의 월급은 남편이 직장을 다닌 5년 동안 시댁에 갖다 주었다. 쌀은 시댁에서 갖다 먹었다. 1976년경 남편은 쌀, 연탄 장사를 했다. 1983년부터 1993년까지 aa시 aa동의 시댁과 왕래하지 않았다.'는 내용과 일치한다. 또한 피상속인은 1988. 7. 1.부터 1994. 4. 7.까지 bb시 cc동에서 ◇◇◇이라는 상호로 사업자등록을 하고 부동산중개업을 운영한 사실이 확인된다.

(3) 피상속인이 벼농사를 했음을 인정할 만한 객관적인 증거가 전혀 없다. 농협협동조합 회원으로 가입한 것으로도 보이지 아니하고, 비료는 물론 농기계 이용에 관한 증거도 없으며, 벼농사에 따른 산출 및 판매량 등에 관한 아무런 증거가 없다. 화물차 구입이 벼농사에 활용된 것이라는 주장을 뒷받침할 만한 증거도 없다. 오히려 김KK은 위 확인서에서 '부친 김JJ이 상속농지에서 농사를 지어왔고, 1988년도에는 자신이 트렉타, 콤바, 이양기를 구입하여 김JJ과 함께 농사를 지었다.'고 진술하고 있는데, 이는 '쌀은 시댁에서 갖다 먹었다'는 망 류BB의 위 진술서 내용에 부합하는 것으로 보인다.

3) Determination as to whether the Plaintiff was “direct farming” for not less than eight years

A) According to Gap evidence Nos. 4-1 to 4, Gap evidence Nos. 19-23, Gap evidence Nos. 24-1 to 17, Gap evidence Nos. 25-27, Gap's mother's 27, 30, 32 through 37, the plaintiff's 3/11 shares in the inheritance land at the time of the death of the decedent, the plaintiff's 2/11 shares in the plaintiff's 2/11 shares, the plaintiff's 3/200 shares in the plaintiff's 3-2/11 shares in the plaintiff's 7-27-27-27-27-27-27-27-27-27-27-27-27-27-3-2007-207-207-3-207-17-20-77-20-77-201-77-201-7

B) However, considering the following circumstances, which can be comprehensively acknowledged as the whole purport of the pleadings as stated in Gap evidence Nos. 10, 29, Eul evidence Nos. 3, 9, 10, and 11, it is insufficient to recognize that the above recognized facts and the evidence submitted by the plaintiff alone were cultivated or cultivated with one half or more of the farming work with their own labor. Therefore, the plaintiff's assertion on the ground that the plaintiff had been "direct farming" for not less than eight years is without merit, and the defendant's disposition of this case is lawful.

(1) From April 27, 1994 to June 2015, the Plaintiff (the date of December 3, 1972) owned the instant land. However, on August 29, 1989, the Plaintiff (the date of December 3, 1972) passed a public announcement of the approval for the graduation from a high school. On January 17, 1995, bB Jdong opened the beauty room with the trade name of 'BJdong-dong' on July 1, 200. On January 5, 2007, the Plaintiff continued to operate the beauty room with the trade name of 'SJJ-dong' from bc c c c c c dong on September 20, 201, the Plaintiff continued to operate the cosmetic (the Plaintiff’s business name of KRW 10 million prior to the lease deposit and KRW 700,000,000,000).

(2) The plaintiff has continuously earned income from the above workplace as follows. However, the plaintiff was actually operated after March 5, 2008.

(3) During the above period, the Plaintiff resided in bb. C. c. and LL Dong, both of which were located at a distance of 21 km from the inherited land. The Plaintiff asserts that the Plaintiff: (a) set up a farming house on the instant land located at b.a. on the new wall and A.m.; (b) returned to b. b. c. on the instant land; and (c) operated the same as a pre-contract. However, in light of the Plaintiff’s fact that the beauty room and pet-house were operated without employing the point, it seems that the straight distance exceeds 42 km from the straight line (the distance is similar to the decedent’s residence, which was 37.6 km) and it is difficult to cultivate or cultivate more than one half of the farming work from the instant land by his own labor; and (b) there is no specific assertion or proof as to how to set up a certain route by any means of transportation.

(4) The plaintiff asserts that he had his inherited land, such as Drho KimCC, and that he had more agricultural history, but there is no evidence to acknowledge it. The KimCC did not engage in any other occupation or business, unlike the plaintiff, and "direct cultivation" requirement of "direct cultivation" of "person engaged in agriculture" is not the same as the above legal principles.

(5) There is no specific or objective evidence to acknowledge that the Plaintiff himself cultivated or cultivated more than half of the farming work with his own labor in the instant land. The farmland ledger is an administrative internal data prepared and kept by the administrative agency for the purpose of farmland management and the efficient implementation of agricultural policies, and it is difficult to deem that the Plaintiff himself prepared the farmland ledger, and it is difficult to recognize the Plaintiff’s self-defense solely based on the entries. b. Chapter 17 of the residents’ confirmation letter does not specify the contents, but rather the network category B had a scambian, and it is nothing more than that of his children. Rather, in light of the above written confirmation and the above written answer of Kim H H, it appears that the network category B had been no more than a 1/2 of the farming work, which goes beyond a certain portion of the Plaintiff’s participation in the farming work, and it is difficult for the Plaintiff to recognize that the Plaintiff was not able to use the said scambling in the name of the Plaintiff and scambianian, and that the Plaintiff had not prepared for the Plaintiff’s own s and s.

3. Conclusion

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