National Tax Service Review and Transfer 2011-0255 ( November 30, 2011)

resident who has a domicile in the Republic of Korea for at least one year;

Considering the fact that a resident owns a high-priced house in the Republic of Korea and resides with his spouse at the time of his stay in the Republic of Korea, the number of days of his stay in the Republic of Korea is not less than one year over two taxable periods, and the fact that he holds a high-priced golf membership in the Republic of Korea other than a house and a non-listed

2012Gudan3777 Such disposition shall be revoked.

LAA

Head of the tax office;

July 18, 2012

September 12, 2012

1. The plaintiff's claim is dismissed.

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

The Defendant’s disposition of imposition of capital gains tax of KRW 000 to the Plaintiff on October 6, 2011 is revoked.

1. Details of disposition;

From January 19, 2006 to February 14, 2006, the Plaintiff acquired the shares of K comprehensive KND Stock Co., Ltd. (hereinafter referred to as “non-party company”) 1,100, and 000 shares (hereinafter referred to as “the shares of this case”) over six times in total, and transferred the shares of this case to 00 won in total within eight times from July 4, 2006 to July 26, 2006, and the Plaintiff did not report the transfer income tax on the shares of this case to 100 won by considering that the Plaintiff was a non-resident under the Income Tax Act. The head of the Seoul Regional Tax Office did not report the transfer income tax on the transfer income tax of this case on the ground that the market value of the shares of this case owned by the Plaintiff was 00 won or more, and the Plaintiff did not report the transfer income tax on the transfer income tax of this case to the Plaintiff on the ground that the Plaintiff did not report the transfer income tax of this case to 000 won or more.

[Grounds for Recognition] The non-contentious facts, Gap evidence 1 through 5 (including each number), Eul evidence 1 and 2, and the purport of the whole pleadings

2. Whether the disposition is lawful;

A. Summary of the Plaintiff’s assertion

"The shares of this case" do not reach 25% of the total amount of the shares issued by the non-party company, and the number of days of the plaintiff's stay in the Republic of Korea in the Republic of Korea on January 83, 2006 and January 182, 2005, where the transfer date belongs to Japan, and the source of economic financing occurs in Japan. Thus, the income accrued by the plaintiff, a non-resident, from the transfer of the shares of this case, shall be non-taxable under Article 179 (10) 1 of the former Enforcement Decree of the Income Tax Act (wholly amended by Presidential Decree No. 19327 of Feb. 9, 2006, and hereinafter referred to as the "former Enforcement Decree of the Income Tax Act"). Therefore, in applying Article 4 (3) of the former Enforcement Decree of the Act or Article 2 (3) of the former Enforcement Decree of the former Enforcement Decree of the Act, the disposition of this case that the defendant

It is as shown in the attached Form.

Multi-Recognitions

(1) At the time of the transfer of the instant shares, the Plaintiff owned at least 000 won the shares of the non-party company, but the instant shares did not reach 25% of the total shares issued by the non-party company.

(2) The number of days of stay in Korea between the plaintiff and his wife KimK is as follows, and the first date of transfer is July 4, 2006.

The base two years immediately preceding (from July 2, 2004 to July 3, 2006) Plaintiff’s domestic stay days are 405 days, and Plaintiff’s wife’s domestic stay days are 415 days.

(3) The Plaintiff and Plaintiff wife’s computerized address at the National Tax Service is 'Seoul Jongno-gu OOdong 000', but the Plaintiff and Plaintiff wife were residing in 'Seoul OOdong 000', the Plaintiff and Plaintiff wife at the time of their stay in Korea.

(4) At the time of the transfer of the instant shares, the Plaintiff had a large amount of assets in Korea (minimum of 000 won) by holding not only the instant shares, but also the instant shares, as shown below, but also the corporation’s emergency stocks of which it was a director.

Current status of domestic assets owned by the plaintiff as of June 2006 (unit or million won)

(5) As of June 2006, the Plaintiff was working for two directors of a social welfare foundation as listed below, and was engaged in domestic activities. Although there was no sales, the Plaintiff was employed by its employees and was employed as a director of a continuing business entity, such as LLFC (main) and LLF (main), and the Plaintiff’s wife was working as the representative director of LLFC (main).

The details of plaintiff's domestic activities> as of June 2006

Omission

[Reasons for Recognition] The aforementioned evidence, Gap evidence Nos. 4 through 8 (including each natural disaster) and the whole purport of the pleading

D. Determination

(1) An individual who has a domicile in Korea or has a domicile in Korea for not less than one year is liable to pay income tax under the Income Tax Act [Article 1(1)1 of the former Income Tax Act (amended by Act No. 7873, Mar. 3, 2006; hereinafter referred to as the "former Act}. The address is determined according to the objective private theory of living relationship, such as the existence of a family member living together in Korea and of assets located in Korea (Article 2(1) of the former Enforcement Decree of the Act), and the place in which a person has a domicile in Korea for a long time other than his/her domicile is located in Korea and in which no general living relationship is formed like his/her domicile (Article 2(2) of the former Enforcement Decree of the Act). In light of Article 4(1) of the former Enforcement Decree of the Income Tax Act and Article 1(1)1 of the former Enforcement Decree of the same Act, if the person has a domicile in Korea for not less than one year over two years, it is considered that he/she has a domicile in Korea for not more than 2 years and 9.

(2) Paragraph (2) provides that a person shall be deemed to have an address in Korea.

(2) Whether Article 4(3) of the former Enforcement Decree of the Act is applied

Article 4 (3) of the former Enforcement Decree of the Act provides that if a period of domestic residence is more than one year over two taxable periods, it shall be deemed that a domestic residence has been established for not less than one year.

(A) The defendant asserts that the meaning of "two taxable periods" is two years counted retroactively from the date of transfer of the shares of this case, and that as of July 4, 2006, the date of the first transfer of the shares of this case to July 3, 2006, the period from July 2, 2004 to July 3, 2006, the date of stay in Korea is 405 days and thus, the plaintiff is a resident pursuant to Article 4 (3) of the former Enforcement Decree of the Act. However, Article 5 (1) of the former Act explicitly provides that "The taxable period shall be from January 1 to December 31, 200," and in principle, income tax adopts the calendar principle, and exceptionally, the taxable period from January 1 to December 31, 2006 shall be from January 2 to the date of death (Article 4 (2) of the former Enforcement Decree). Thus, the defendant's assertion that the taxable period from January 2 to July 31, 2006 can not be accepted.

(B) As seen earlier, the Plaintiff’s domestic stay days in 2004 are 235 days and 183 days, and the domestic stay days in 2005 are 183 days, so the Plaintiff is a resident under the above provision, and the Plaintiff is a resident under Article 4(3) of the former Enforcement Decree of the Act, and the Plaintiff is departing from the Republic of Korea on January 15, 2006 (Evidence 6).

The plaintiff's domestic stay days in the whole year of 2006 is 181 days and includes 2005 and 2006, and the domestic residence period is 364 days during the two taxable periods, so it does not fall under the case of more than one year over two taxable periods, and the above provision does not apply to this case.

(3) Whether Article 2(3)2 of the former Enforcement Decree of the Act is applied

According to Article 2 (3) 2 of the former Enforcement Decree of the Act, when an individual residing within one year has a family living together in the Republic of Korea and is deemed to have a domicile in the Republic of Korea for at least one year in view of his occupation and asset status. As shown in the facts acknowledged earlier, the plaintiff owned a high-priced house in Seongbuk-gu Seoul, Seongbuk-gu, and resides in the above Seongbuk-dong house like his wife at the time of his stay in Korea, and both the plaintiff and wife's nationality are 244 days in 2004 and 205 days in 206 in 2006, the number of stay days in the Republic of Korea is 2 years in 192 days in 206, and the plaintiff's disposition should be deemed to have a legitimate domicile in the Republic of Korea for at least two years in 192 days in 206 in addition to the above Sungbuk-dong house at the time of transfer of the shares in this case, considering the fact that the plaintiff has a high-priced golf club in Korea and other domestic activities of the plaintiff.

3. Conclusion

The plaintiff's claim is dismissed for lack of reason.