Suwon District Court 2012Guhap3713 ( February 26, 2012)

actual transaction value means the actual transaction value in itself or at the time of the transaction;

In calculating gains on transfer, which is the tax base of capital gains tax, the actual transaction value refers to the amount of actual agreement not to reflect the objective exchange value, but to the actual transaction price itself or at the time of the transaction.

Article 163 (3) 2 of the former Enforcement Decree of the Income Tax Act

2012Nu31740 Revocation of imposition of capital gains tax

GuAA

port of origin

Suwon District Court Decision 2012Guhap3713 Decided September 26, 2012

October 15, 2013

November 15, 2013

1. The plaintiff's appeal is dismissed.

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

The judgment of the first instance shall be revoked.

The Defendant’s imposition of the capital gains tax of 2010 on August 1, 2011 against the Plaintiff shall be revoked.

1. Transfer income tax;

The following facts are either in dispute between the parties or in accordance with Gap evidence Nos. 1, 2, 3, and Eul evidence Nos. 1, 2, and 1, 2, and the whole purport of the pleadings.

[1]

The registration of ownership transfer was completed on June 20, 2007 under the Plaintiff’s name with respect to the land of 3,091 square meters (hereinafter “the land of this case”) in the name of OB in the name of OB in the name of OB, OB, OB, OB, OB (OO-gu O-type O-type O-type, O-type, O-type, O-type, O-type due to a change in the name of the administrative district).

around August 31, 2007, the formerB reported the transfer income tax on the land of this case, and reported the transfer value according to the actual transaction value as OOO.

○ After October 1, 2010, the Plaintiff transferred the instant land to thisCC with the OOO on and around October 1, 201, and on October 7, 2010, the ownership transfer registration was completed in the name of thisCC regarding the instant land.

○ The Plaintiff did not report the transfer income tax on the instant land.

[2]

○ As above, on August 1, 2011, the Defendant: (a) considered the transfer value reported by the formerB as the acquisition value of the Plaintiff based on the actual transaction value; and (b) imposed the capital gains tax on the instant land on the Plaintiff (including the additional tax for the failure to report and the failure to pay the tax in good faith) (hereinafter “instant disposition”).

○ The Plaintiff dissatisfied with the instant disposition and filed a request for examination with the Commissioner of the National Tax Service on September 27, 201, upon filing an objection on August 23, 2011, but was dismissed on December 23, 2011.

2. The plaintiff's assertion

Article 100 (1) of the Income Tax Act (amended by Act No. 10408, Dec. 27, 2010; hereinafter the same) stipulates that when the transfer value is based on the actual transaction price in calculating transfer margin, the acquisition value shall be based on the actual transaction price, and when the transfer value is based on the standard market price, the acquisition value shall be based on the standard market price.

Since around 1996, the Plaintiff’s old GuB imposed money equivalent to educational expenses, living expenses, etc. of his children from the Plaintiff, and decided to transfer the instant land to the Plaintiff as payment in lieu of the Plaintiff, and completed the registration of ownership transfer in the Plaintiff’s name and entered the transfer of ownership in the application for registration of transfer of ownership in the application for registration of transfer of ownership (i.e., the transfer of ownership (i., the value of the instant land x3,091 square meters) calculated by the officially announced value at the time of the transfer of ownership (i.e., the value of the instant land x3,091 square meters). Accordingly, the above OOOB did not constitute the transfer value of the old BB based on the actual transaction value, but is not the Plaintiff’s acquisition value based on the actual transaction value.

In the instant disposition, the Plaintiff had different knowledge about the actual transaction value while calculating the transfer margin that the Plaintiff transferred the instant land to thisCC. In such a case, the acquisition value is based on the actual transaction value or according to the transaction example value, appraisal value, and conversion value, and if such method is impossible, all the acquisition value and transfer value shall be based on the standard market price. As such, in the instant disposition, the transfer value is based on the actual transaction value and the Plaintiff’s acquisition value is illegal as it is in violation of Article 100(1) of the Income Tax Act.

3. Determination

In calculating gains on transfer, which is the tax base of capital gains tax, the actual transaction value refers to the amount of actual agreement not to reflect the objective exchange value, but to the actual transaction price itself or at the time of the transaction.

According to the above facts of recognition, the formerB transferred the instant land to the Plaintiff on or around June 2007, and reported the transfer income tax on the instant land on or around August 31, 2007, and reported the transfer value based on the actual transaction value as the OOOwon. The formerB stated the value of the instant land at the time of trial testimony in 2007 as the level of OOOO or OOOOOOO won per usual. This is without a big difference in comparison with the above transfer value (i.e., approximately 1,00 x approximately 1,00 x OOOO = approximately OOOO).

According to the Plaintiff’s assertion, the former B transferred the instant land from the Plaintiff from January 1, 1996 to December 31, 2009, to the Plaintiff, and the former B transferred the instant land to the Plaintiff by means of payment in lieu of the borrowed money. However, according to the Plaintiff’s evidence Nos. 3 and 2, the former B transferred the instant land to the Plaintiff, while transferring the land to the Plaintiff, the land was transferred to the Plaintiff at the time of the transfer by the former B along with the OO No. 50-1 and 50-5 of the same Ri 550-5, and the transfer value according to the actual transaction value at the time of transfer to the Plaintiff is recognized as having been reported by the Plaintiff, so it is difficult to view that the transfer value under the actual transaction value at the time of the transfer is different from the former BOO’s actual transaction value as the actual transaction value reported by the Plaintiff.

On the other hand, in a case where assets are transferred by payment in kind, liabilities to be extinguished and assets acquired are in a mutual relation, unless there are special circumstances, and the amount calculated by the officially announced land price may be agreed as the transfer price.

In full view of the above circumstances, at the time when the former B transferred the instant land to the Plaintiff and the Plaintiff acquired it, the former B and the Plaintiff agreed to transfer the value of the instant land to the Plaintiff as an OOO, and recognized that the said amount was the Plaintiff’s acquisition value based on the actual transaction value, and the evidence alone, which alone was insufficient to reverse such recognition.

Therefore, the instant disposition imposing capital gains tax on the Plaintiff on the ground that the above OOOO personnel is the Plaintiff’s acquisition price based on the actual transaction price is legitimate, and the Plaintiff’s assertion that the said amount cannot be deemed as the Plaintiff’s acquisition price based on the actual transaction

4. Conclusion

Therefore, the plaintiff's claim seeking the revocation of the disposition of this case shall be dismissed as it is without merit, and the judgment of the court of first instance is just, and the plaintiff's appeal is dismissed as it is so decided as per Disposition.