Cho Jae-2015-China-5418 ( December 31, 2015)

Article 28 (1) of the Inheritance Tax and Gift Tax Act refers to the amount of gift tax calculated by applying the tax rate to the tax base of gift tax.

"Gift tax amount" under Article 28 (1) of the Inheritance Tax and Gift Tax Act means the amount of gift tax calculated by applying a specified tax rate to the tax base of gift tax under the Inheritance Tax and Gift Tax

Article 28 (Deduction of Gift Tax Amount)

2016Guhap62376 Revocation of Disposition of Levying Inheritance Tax

KK

Head of △ District Office

July 6, 2016

August 17, 2016

1. Each part of the instant lawsuit against the Plaintiff (Appointed Party), the Appointed Party AA, and the CCC shall be dismissed.

2. The remaining claims of the Plaintiff (Appointed Party BB) (Appointed Party BB) are dismissed.

3. The costs of litigation shall be borne by the Plaintiff (Appointed Party) and the Appointed BB, AA, and CCC.

Cheong-gu Office

On October 16, 2015, the Defendant revoked the imposition of KRW 00,000,000 of inheritance tax imposed on the Plaintiff (Appointed Party; hereinafter referred to as the “Plaintiff”) and the Appointed BB, AA, and CCC.

1. Details of the disposition;

A. On June 19, 2014, the Plaintiff and the designated parties BB, AA, and CCC (hereinafter collectively referred to as “the Plaintiff, etc.”) were the successors of the AnsanJ (hereinafter referred to as “the inheritee”) who died on June 19, 2014, and reported and paid KRW 00,000,000 inheritance tax to the Defendant on December 31, 2014.

B. As a result of the inheritance tax investigation conducted from June 5, 2015 to September 21, 2015, the Defendant determined that the decedent donated the shares equivalent to KRW 000,000,000 (hereinafter “instant shares”) to the Plaintiff, the designated parties BB, and AA as indicated in the following table.

Date of donation;

Gifted Stocks

Testamentary donee

Amount of donation;

Name of shares

Number of Stocks

December 27, 2010

D D Securities Cows

1,850

00,000,000

April 29, 2011

2,340

May 19, 2011

6,890

July 1, 2011

5,150

January 10, 2013

4,600

December 27, 2010

D D Securities Cows

1,850

Master BBB

00,000,000

April 29, 2011

3,150

January 11, 2011

KK Electronic

19

Appointed AAA

00,000,000

April 18, 2011

1

July 12, 2011

9

September 27, 2011

1

January 10, 2013

2

Total

00,000,000

C. Pursuant to Article 13(1)1 of the former Inheritance Tax and Gift Tax Act (amended by Act No. 12168, Jan. 1, 2014; hereinafter “former Inheritance Tax and Gift Tax Act”), the Defendant added the said KRW 00,000,000 to the value of inherited property, and deducted the amount of gift tax calculated by deducting donated property from the calculated amount of inheritance tax pursuant to Articles 28(1) and 53 of the former Inheritance Tax and Gift Tax Act, and determined and notified the Plaintiff, etc. on October 16, 2015. The Plaintiff and the appointed AAA was served on October 29, 2015, BB, and CCC on October 21, 2015.

D. The Selected BB was dissatisfied with the disposition of inheritance tax as described above (c) and filed an appeal with the Tax Tribunal on November 6, 2015. However, the Tax Tribunal dismissed BB’s appeal on December 31, 2015.

E. On June 9, 2016, the Defendant recognized the amount of deduction of the gift tax amount on BB by the selector, and corrected the amount of inheritance tax to KRW 00,00,000 (hereinafter the above reduced amount) by reducing the amount of inheritance tax to KRW 00,000.

[Basis] Facts without dispute, Gap evidence 1, Eul evidence 2-1, Eul evidence 1-2, Eul evidence 2-1, 2-2, Eul evidence 2-1, 2-2, and the purport of the whole pleadings

2. Whether the part of the instant lawsuit against the Plaintiff, Selected AA, and CCC is legitimate

Where two or more dispositions for the same purpose in tax administration were taken in the course of a phased and developmental process and are related to each other, or in the course of a tax litigation, the tax authority changed the taxation disposition, which is the object of which, and the reason for illegality is common, or where several persons are jointly liable for the same obligation through the same disposition, one of the taxpayers who was either subject to a prior trial procedure or subject to the same disposition has been given an opportunity for the National Tax Service and the Tax Tribunal to re-determine the basic facts and legal issues, such as the time when the previous trial procedure was duly conducted, and the taxpayer seems to be harsh to have been subject to the prior trial procedure, and thus, the taxpayer may file an administrative litigation seeking the revocation of the taxation disposition even without going through the prior trial procedure (see Supreme Court Decision 2012Du20618, Dec. 11, 2014).

However, the main text of Article 56(3) of the Framework Act on National Taxes excludes the application of Article 20 of the Administrative Litigation Act concerning the period for filing a lawsuit. As such, Article 56(2) of the Framework Act on National Taxes provides that an administrative litigation against a tax disposition may not be filed without undergoing the procedure for a prior trial under the Framework Act on National Taxes, barring any special circumstance, in a case where a taxpayer may file a lawsuit seeking revocation of a tax disposition even without undergoing the procedure for a prior trial, such revocation lawsuit shall be instituted within 90 days from the date on which he/she becomes aware of the disposition, etc., as prescribed by Article 20(1) of the Administrative Litigation Act, barring any special circumstance. The same applies to a case where one of the persons liable for tax payment, who is liable for the same obligation, files a lawsuit seeking revocation of a tax disposition immediately without undergoing the procedure for prior trial (see Seoul Administrative Court Decision 2015Guhap59

In this case, the health department, the Defendant rendered the instant disposition to the Plaintiff and Selection AA and CCC on October 16, 2015, and the Plaintiff and Selection AA received the instant disposition on October 29, 2015, and on October 21, 2015, the fact that the Selection CCC was served on October 21, 2015 is as recognized in the preceding 1. C, and the fact that the Plaintiff filed the instant lawsuit on March 24, 2016 after the lapse of 90 days is apparent in the record.

Of the instant lawsuits, the part against the Plaintiff, Appointor AA, and CCC is unlawful as the time limit for filing the lawsuit expires.

3. Whether the instant disposition against the designated party BB is legitimate

A. The plaintiff's assertion

The term "donation tax amount" under Article 28 (1) of the former Inheritance Tax and Gift Tax Act refers to "the calculated tax amount of gift tax on the taxable value of donated property which has not been deducted from donated property. Nevertheless, the defendant deducted the amount of gift tax calculated by deducting donated property from the calculated tax amount of inheritance tax, and made the disposition of this case.

B. Relevant statutes

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

C. Determination

Article 28(1) of the former Inheritance Tax and Gift Tax Act provides that the amount of gift tax (referring to the amount of gift tax calculated on the donated property at the time of donation) on donated property added to inherited property in the amount of inheritance tax calculated. This provision provides that the amount of gift tax on donated property (referring to the amount of gift tax on the donated property at the time of donation) shall be deducted. This provision provides that the amount of gift tax on donated property shall be added to the value of inherited property within a certain period from the date of inheritance. If gift tax is not considered because the value of donated property is added to the value of inherited property, which is the basis of calculation of inheritance tax, for the same property, double taxation of inheritance tax and gift tax on the same property or imposition of inheritance tax on non-taxable donated property. Thus, the amount of gift tax referred to in the above provision provides that the amount of gift tax means the amount equivalent to the amount of gift tax calculated on the assumption that it is subject to taxation in the case of donated property or non-taxable donated property (see Supreme Court Decisions 77Nu304, Dec. 23, 1986; 20Du72012, May 2012.

Therefore, “Gift tax amount” under Article 28(1) of the former Inheritance Tax and Gift Tax Act means the amount of gift tax calculated by applying a specified tax rate to the tax base of gift tax under the former Inheritance Tax and Gift Tax Act. Article 55(1)4 of the former Inheritance Tax and Gift Tax Act provides that “The tax base of gift tax shall be the amount calculated by subtracting the fees for appraisal of donated property prescribed by Presidential Decree from the amount calculated by subtracting the amount under Articles 53 and 54 from the taxable value of donated property.” Article 53 provides that “If a gift is received from a spouse, 60 million won shall be deducted from the taxable value of donated property, and 30 million won shall be deducted from the taxable value of donated property if a gift is received from a lineal ascendant.” Thus, in calculating the amount of gift tax under Article 28(1) of the former Inheritance Tax and Gift Tax Act, the Plaintiff and the designated person should obtain a deduction of donated property under Article 53 of the former Inheritance Tax and Gift Tax Act from the taxable value of donated property (see Supreme Court Decision 201Du720, May 9, 201).

The plaintiff's above assertion is without merit.

4. Conclusion

Among the lawsuits in this case, the part against the plaintiffs, Appointors AA, and CCC is unlawful, each of them is dismissed, and the remainder of the plaintiff's claim (the part against the Appointed BB) is groundless, and it is dismissed. It is so decided as per Disposition.