In respect of a gift, the cultivation period of the donor and the donee shall not be added up;

In applying the capital gains tax reduction and exemption provisions for self-farmland for 8 years, the period of cultivation between the donee and the donor shall not be added.

The contents of the decision shall be the same as attached.

1. The plaintiff's claim is dismissed.

2. The plaintiff shall bear the litigation costs.

The Defendant’s disposition of imposing KRW 67,343,030 on the Plaintiff on February 12, 2010 shall be revoked.

1. Details of the disposition;

The following facts are not disputed between the parties, or are recognized by Gap evidence 1 through Gap evidence 3, Gap evidence 7, Eul evidence 1, Eul evidence 2 (including each number), and the whole purport of the pleadings.

A. On February 5, 2001, the Plaintiff acquired three parcels of land (hereinafter referred to as “instant land”) of 216-18 square meters in ○○○○○-gu, ○○○○-si, ○○○○-do, 216-18 square meters in 216-21, 216-21 square meters in e.g., 216-28, and 712 square meters in e.g., 216-28 before e., e., e., “○-si, ○○-gu, ○○-si,” and transferred the instant land to Nonparty Jeong-B on a voluntary auction on July 18, 2007,

B. Accordingly, the Defendant confirmed the Plaintiff’s non-report of capital gains tax, and calculated gains from transfer by deeming the transfer value as KRW 232,210,00,00, the successful bid price of the instant land, and by deeming the acquisition value as KRW 32,145,880, which is the value of donated property, as the value of donated property, and imposed capital gains tax of KRW 67,343,00 on the Plaintiff on February 12, 2010 (hereinafter “instant disposition”).

C. The Plaintiff dissatisfied with the instant disposition and filed an appeal with the Tax Tribunal on May 12, 2010.

2. Determination as to the legitimacy of the instant disposition

The plaintiff asserts that the disposition of this case is unlawful for the following reasons.

(1) Although the copy of the register of the land of this case states that the Plaintiff was donated by the formerA to the Plaintiff, the actual owner of the land of this case is not the Plaintiff but the former spouse, and thus, the transfer income tax under the substance over form principle ought to be imposed on the formerA. Even if the Plaintiff was liable to pay a domestic tax, the transfer income tax should be imposed on the said land on February 16, 2006, on the ground that the formerA provisionally attached the amount of claim 165,750,000 won to the land of this case on February 16, 2006,

(2) The Plaintiff’s family members directly cultivated the instant land from the date of acquisition on December 24, 1997 to the time of transfer on July 18, 2007, and for 8 years or more when adding up the period of self-determination of the Plaintiff, a donor, the formerA and the Plaintiff, a donee, the donor, the amount of capital gains tax shall be reduced in full pursuant to Article 69(1) of the Restriction of Special Taxation Act.

(3) Although the successful bid price of the instant land was KRW 187,977,104, the Defendant’s application of the transfer price of the instant land to KRW 232,210,000 is unlawful.

(4) According to Article 116 of the Income Tax Act, the head of the competent district tax office prescribed that the Defendant fixed the capital gains tax within three months from the payment deadline of the capital gains tax, but the Defendant took the instant disposition from May 31, 2008 to February 12, 2010 exceeding three months, which is the capital gains tax payment deadline. If the Defendant issued a pre-payment notice to the Plaintiff on behalf of the Plaintiff, it would not have any additional tax, and thus, the Defendant’s imposition of additional tax up to the date of the said disposition is unlawful.

(5) The Defendant’s failure to apply the special long-term holding deduction under Article 95 of the Income Tax Act is unlawful.

(b) Related statutes;

It is as shown in the attached Table related statutes.

C. Determination

(1) Determination on the first argument

(A) Article 14(1) of the Framework Act on National Taxes provides for the principle of substantial taxation as to the attribution of income, profit, property, act, or transaction, which is subject to taxation, in a case where there is a person to whom such income, profit, or transaction belongs, and there is another person to whom such income, profit, property, act, or transaction belongs, the person to whom such income, or transaction belongs shall be liable to pay taxes. In light of the principle of substantial taxation, if a person who is registered as an owner in the real estate registry is merely a nominal owner, and if there is another real owner, the nominal owner on the registry shall not be deemed a nominal owner, but the nominal owner on the registry shall be proved by the nominal owner who asserts that he is not the actual

(B) In this case, in light of the above legal principles, the fact that the plaintiff received the donation of the land in this case from the former husband of the plaintiff, and completed the registration, as seen earlier, that the plaintiff, who is a registered titleholder of the land in this case, is the former husband, shall prove that the actual owner of the land in this case is the formerA, and there is no other evidence to acknowledge it.

(C) Therefore, the Plaintiff’s assertion to the effect that the instant land is owned jointly by the former and the former and the former are owned jointly by the former.

(2) Judgment on the second argument

(A) Article 69(1) of the former Restriction of Special Taxation Act (amended by Act No. 9276 of Dec. 29, 2008; hereinafter the same) provides that the amount of tax equivalent to 10/100 of the transfer income tax on the income accruing from the transfer of land prescribed by the Presidential Decree, which is cultivated directly by the resident prescribed by the Presidential Decree residing in the location of the land for not less than eight years, shall be reduced or exempted. Article 66(1) of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Act No. 20620 of Feb. 22, 2008; hereinafter the same) provides that the person who has cultivated while residing in the Si/Gun/Gu where farmland is located and the Si/Gun/Gu adjacent to the Si/Gun/Gu where the farmland is located shall be the requirements for such reduction or exemption. In calculating the period cultivated under paragraph (111), the period acquired by the decedent shall

(B) Meanwhile, under the principle of no taxation without representation, the interpretation of tax laws and regulations shall be interpreted in accordance with the text of the law, barring special circumstances, and it shall not be permitted to expand or analogically interpret it without reasonable grounds. In particular, the strict interpretation of the provision that can be seen as a clearly preferential provision among the requirements for reduction and exemption accords with the principle of fair taxation (see Supreme Court Decision 2008Du11372, Aug. 20, 2009).

(C) In light of the above provisions and legal principles, the Plaintiff asserts to the effect that the total amount of capital gains tax should be reduced or exempted as it exceeds eight years under Article 69(1) of the former Restriction of Special Taxation Act if the sum of periods cultivated by the Plaintiff and the formerA, the donor, who is the donee, exceeds eight years. However, in the case of inheritance, unlike the provision that the period of cultivation by the heir and the decedent should be added, in the case of inheritance, there is no provision that the donee and the donor should be added up, and in the case of donation, the provision of Article 69(1) of the former Restriction of Special Taxation Act Article 69(1) of the former Enforcement Decree of the Restriction of Special Taxation Act is a clear preferential provision that reduces the total amount of capital gains tax due to the transfer of cultivated farmland.

(D) Therefore, the Plaintiff’s above assertion is without merit.

(3) Judgment on the third argument

The plaintiff asserts that the value of the land of this case should be calculated as the transfer value because it is KRW 187,977,104. However, there is no evidence to acknowledge that the transfer value of the land of this case is 232,210,000 according to the evidence No. 2. Thus, the plaintiff's above assertion is without merit.

(4) Judgment on the fourth argument

(A) In order to facilitate the exercise of taxation rights and the realization of tax claims, additional tax under tax law is an administrative sanction imposed under the conditions as prescribed by individual tax law in cases where a taxpayer violates various duties, such as a return and tax payment, without justifiable grounds, and the taxpayer’s intent or negligence is not considered. On the other hand, such a sanction cannot be imposed in cases where there are justifiable grounds for not being able to cause the taxpayer’s failure to perform his/her duties, such as when there are circumstances where it is unreasonable for the taxpayer to be unaware of his/her duty, or when it is unreasonable for him/her to expect the fulfillment of his/her duty (see, e.g., Supreme Court Decision 2003Du13632, Jan. 27, 2005).

(B) In light of the above legal principles, the Plaintiff asserted that the Plaintiff’s transfer income tax should be fixed within three months from May 31, 2008, which is the due date under Articles 110 and 111 of the Income Tax Act pursuant to Article 116 of the Income Tax Act, but the Plaintiff’s notification of transfer income tax to the Plaintiff on February 12, 2010, which is the disposition date of this case, constitutes a case where there is any justifiable cause not attributable to the Plaintiff’s neglect of duty. However, under Article 110 of the Income Tax Act, the Plaintiff’s transfer income tax base cannot be determined differently from May 1 to May 31, 2008 (in the case of the proviso to Article 105(1)1, from May 1 to May 31, 2008, to the head of the competent tax office or the head of the competent tax office having jurisdiction over the place of tax payment, and thus, it is difficult to deem the Plaintiff’s tax base to be reported differently as prescribed by Presidential Decree.

(5) Judgment on the fifth argument

The plaintiff asserted that the defendant did not deduct the special deduction for long-term holding under Article 95 of the Income Tax Act while taking the disposition of this case. However, according to the Eul evidence No. 1, the defendant can be recognized that the defendant calculated the tax base by deducting the special deduction for long-term holding from the transfer value of this case 30,009,616 won, while taking the disposition of this case. Thus, the plaintiff's assertion

3. Conclusion

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