early 201-Gu3222 ( December 15, 2011)

Considering occupation, location, distance, etc., no person is a self-employed farmer;

When applying reduction or exemption pursuant to substitute soil, it shall not be deemed that it is merely an indirect management of agriculture with the belief of other occupation, and it shall not be deemed that it is not a self-employed farmer in consideration of the Plaintiff’s occupation and location of the farmland

2012Guhap548 Revocation of Disposition of Imposition of Gift Tax

XX

Head of North Daegu Tax Office

June 27, 2012

July 20, 2012

1. The plaintiff's claim is dismissed.

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

The Defendant’s imposition of capital gains tax of KRW 000 against the Plaintiff on July 5, 201 shall be revoked.

1. Details of the disposition;

A. On July 31, 2003, the Plaintiff acquired 609-9 return 2,028m2 (hereinafter “previous farmland”) from Daegu-gun, Daegu-gun, and sold the previous farmland to the Korea Land Corporation in KRW 000 on October 27, 2008.

B. On November 28, 2008, the Plaintiff filed a final return of capital gains tax on the previous farmland under Article 70 of the former Restriction of Special Taxation Act (amended by Act No. 9921, Jan. 1, 2010; hereinafter the same) and applied for reduction or exemption of capital gains tax on the ground that it is the substitute land for farmland under Article 70 of the former Restriction of Special Taxation Act (amended by Act No. 9921, Jan. 1, 2010; hereinafter the same). On April 15, 2009, the Plaintiff acquired the Ligu-gun-gun, Daegu-gun, the husband of which was the husband, about 296-3

C. On July 5, 2011, the Defendant: (a) acquired substitute farmland by her husband’s donation; (b) did not acquire it due to the need for cultivation; and (c) deemed that it did not do so for three years; and (d) excluded the application of the transfer income tax reduction and exemption provisions; and (c) corrected and imposed capital gains tax of KRW 00 on the Plaintiff (hereinafter “instant disposition”).

D. The Plaintiff filed an appeal with the Tax Tribunal on September 9, 201, but was dismissed on December 15, 2011.

[Ground of recognition] Facts without dispute, Gap evidence 1 through 4, Eul evidence 1, 2, 4-1 and 4-2, the purport of the whole pleadings

2. The plaintiff's assertion is as follows.

The plaintiff purchased the substitute land in the form of payment in kind, not by donation from Park Jong, a husband, and cultivated the substitute land directly with Park Jong.

3. Related statutes;

Attachment 'Related Acts and subordinate statutes' shall be as shown.

4. Determination

A. According to Article 70(1) of the former Restriction of Special Taxation Act and Article 67(1), (2), and (3)1 of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 22037, Feb. 18, 2010; hereinafter the same), in cases where a person who resided in a location of previous farmland for not less than three years and cultivated while residing in a new farmland for not less than three years, by acquiring another farmland within one year from the date of transfer due to necessity for cultivation, while residing in a new farmland for not less than three years, and where the newly acquired farmland area is not less than half of the farmland area to be transferred or the value of the newly acquired farmland is not less than a third of the transferred farmland value, the tax amount equivalent to 100/100 of the transfer income tax on the transfer income

According to Article 70 (1) of the Restriction of Special Taxation Act and Article 67 (2) of the Enforcement Decree of the same Act, "direct cultivation" means that a resident is engaged in cultivating crops or growing perennial plants on his/her own farmland at all times or is engaged in cultivating or cultivating not less than 1/2 of farming work with his/her own labor.

The principle of strict interpretation derived from the principle of no taxation without law is applicable not only to the cases that meet the taxation requirements, but also to the cases that meet the requirements for non-taxation and tax reduction and exemption. As such, extensively interpreting or analogical interpretation of the requirements for non-taxation or tax exemption and exemption as favorable to taxpayers without any justifiable reason leads to a result contrary to the principle of fair taxation, which is the basic ideology of the tax law, and thus, it shall not be allowed (see, e.g., Supreme Court Decision 2005Da191

The purport of not imposing capital gains tax on farmland substituted by necessity for cultivation is to protect farmers by allowing and guaranteeing free substitution of farmland, thereby promoting the development and encouragement of agriculture. Therefore, the previous land and new acquired land shall be farmland at the time of transfer, and the transferor shall be a person with own land at the time of transfer of the previous land, and a new land shall be acquired for the purpose of self-defense. In the case of speculative farmland transactions, such as selling and selling farmland after acquiring short-term transfer marginal profits on a temporary basis, not simply by selling and transferring the farmland owned by the self-employed farmer for the sake of cultivation, it shall not be subject to non-taxation under the above Acts and subordinate statutes (see, e.g., Supreme Court Decision 95Nu3695, Sept. 295). However, if the former land and new acquired land are indirectly managed in agriculture in reliance on other occupation, it shall not be deemed that it falls under cases where the former land and new land are purchased for the purpose of self-defense (see, e.g., Supreme Court Decision 2009Du39394, Oct. 111, 2093).

B. In light of the following circumstances, it is insufficient to acknowledge only the descriptions and images of evidence Nos. 5 and evidence Nos. 21-3, and there is no other evidence to acknowledge it. The Plaintiff’s assertion is without merit, inasmuch as there is no other evidence to acknowledge it. The Plaintiff’s assertion is without merit. The Plaintiff’s assertion is without merit.

(1) Since the Plaintiff was transferred the ownership of substitute farmland from Park Jong-A, her husband, pursuant to Article 44(1) of the former Inheritance Tax and Gift Tax Act (wholly amended by Act No. 9916, Jan. 1, 2010), the said transfer is presumed to be a gift. On May 14, 2010, the Plaintiff voluntarily prepared and submitted to the Defendant a gift tax base return and a return of tax base of gift tax on the donation of substitute farmland (Evidence 5) (Evidence 5). On December 10, 2008, the Plaintiff delivered KRW 00 out of the transfer price of the previous farmland to Park Jong-A, and on February 19, 2009, entered into a sales contract with Park Jong-A to purchase the substitute farmland amount of KRW 00 and receive the down payment and the intermediate payment of KRW 00 on the date of the contract (Evidence 5).

(2) In this Court, the witness KimB: (a) he continued to cultivate substitute farmland from the date of the ownership of the KimCC after he purchased on September 6, 2004, and he transferred substitute farmland to ParkA around April 2007; (b) thereafter, he cultivated approximately 100 m of substitute farmland out of substitute farmland (a vinyl cultivation) on the same condition after the Plaintiff acquired substitute land; (c) the Plaintiff cultivated substitute land on the same condition after the Plaintiff acquired substitute land; and (d) the Plaintiff voluntarily testified in substitute farmland, such as installation of support team, miscellaneous removal, cell removal, blight prevention of blight and harmful insects, agricultural dust spread, etc.; and (d) the Plaintiff testified that the Plaintiff’s work by employing another person rather than the Plaintiff’s own agricultural work.

(3) The area of the substitute farmland is larger than 2,982 square meters. According to the statement of the resident who was heard by the Defendant’s public official, on February 8, 201, the residents living in front of the substitute farmland were cultivated by several local residents, and the dry field owner was regarded as one time in 2010 (Article 3 subparag. 3-2), and on April 12, 201, the village head KimB and the residents Cho Dong-D stated that they leased the substitute farmland (Article 4-1 of the evidence No. 4).

(4) From April 30, 2007, the Plaintiff is registered as a business entity of YY tools (relic wholesale business) located in the Daegu North-dong Distribution Complex. The annual gross income of the said Y work site company is KRW 000 in 2008, KRW 000 in 2009, and KRW 000 in 2010 in 2010. The Plaintiff and husband’s domicile of YA is about KRW 539-1 AAtaly 102 in 201 and approximately 40 km away from the Dae-to-land.

5. Conclusion

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