Cho Jae-2017-Divisions-2212 (No. 27, 2017)

The agreement on division of inherited property shall not constitute a ground for subsequent request for correction.

It is not permissible to request a correction of the already-established comprehensive real estate holding tax on the ground that the taxpayer of each land of this case is changed following the consultation on division of inherited property.

Request for adjustment of Article 2 of the Comprehensive Real Estate Tax Act and correction of Article 45-2 of the Framework Act on National Taxes

2017Guhap51929 Revocation of revocation of comprehensive real estate holding tax

ZZ

YThe director of the tax office

October 31, 2017

November 28, 2017

1. The plaintiff's primary and conjunctive claims are all dismissed.

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

Cheong-gu Office

1. The primary purport of the claim

On April x, 2017, the Defendant’s disposition rejecting the reduction or correction of KRW 20,278,341 of the comprehensive real estate holding tax against the Plaintiff is revoked.

2. Preliminary purport of claim

On April 1, 2017, the Defendant confirmed that the disposition rejecting the reduction of 20,278,341 won of comprehensive real estate holding tax against the Plaintiff is null and void.

1. Details of the disposition;

A. The Plaintiff’s father, the Plaintiff’s father, died on January 15, 2016, and the inheritance commenced on the same day. The Plaintiff’s father, owned 184-G EEle 184-G 1868 square meters and 14 lots (hereinafter “each of the instant lands”).

B. As of the tax base date of comprehensive real estate holding tax in 2016 (amended by Act No. 14567, Feb. 8, 2017); Article 12 of the Comprehensive Real Estate Holding Tax Act; Article 107(2)2 of the former Local Tax Act (amended by Act No. 14567, Feb. 8, 2017; hereinafter the same) and Article 53 of the former Enforcement Rule of the Local Tax Act (amended by Ordinance of the Ministry of Public Administration and Security No. 1, Jul. 26, 2017; hereinafter the same) on the ground that the registration of inheritance was not made on each of the instant land and the de facto owner did not file a report, the Defendant deemed the extended Plaintiff as the primary heir; and on December 5, 2016, imposed KRW 20,278,341 of the comprehensive real estate holding tax in 2016 on the Plaintiff.

C. On March 9, 2017, the deceased U.S.A’s heir, including the Plaintiff (Plaintiff, FF, UNG, UNH, J, K, U.K., and UNL) entered into a joint agreement with the U.S.F to solely inherit each of the instant land (hereinafter “instant agreement on the division of inherited property”), and the U.F. entered into the registration of ownership transfer on each of the instant land due to inheritance following the agreement division.

D. On March 21, 2017, the Plaintiff filed a request for rectification of comprehensive real estate holding tax imposed on the Plaintiff on the Defendant on the grounds that each of the instant land was solely inherited to FF by agreement division. However, the Defendant rejected the request on April 10, 2017 (hereinafter “instant disposition”).

E. The Plaintiff appealed and filed an appeal on April 11, 2017, but was dismissed on June 26, 2017.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1 through 4, Eul evidence No. 1, the purport of the whole pleadings

2. Relevant statutes;

Article 12 (1) of the Comprehensive Real Estate Holding Tax Act provides that "in cases of a person liable to pay property tax on land as of the base date for taxation, who is in excess of 500 million won by summing up the officially announced price of the relevant taxable land located in Korea shall be liable to pay comprehensive real estate holding tax." Article 2 (6) of the same Act provides that "property tax on land means property tax imposed on land in accordance with Articles 105 and 107 of the Local Tax Act."

In addition, Article 107 (1) of the former Local Tax Act provides that "any person who actually owns property as of the tax base date of property tax shall be liable to pay property tax," and Article 107 (2) of the former Local Tax Act provides that "any person who falls under any of the following subparagraphs as of the tax base date of property tax shall be liable to pay property tax, notwithstanding paragraph (1)" provides that "if the registration of inheritance has commenced and the actual owner has not been reported without the execution of the registration of inheritance, the principal heir prescribed by Ordinance of the Ministry of Government Administration and Home Affairs," and Article 120 (1) provides that "a person falling under any of the following subparagraphs shall prepare evidentiary documents and report such fact to the head of the local government having jurisdiction over the location of the property within 10 days from the tax base date, if the registration of inheritance has not been made" under subparagraph 2 of Article 107 (2) and Article 53 of the former Enforcement Rule of the Local Tax Act provides that "the principal heir under the Civil Act shall be the highest heir's share in inheritance as prescribed by Ordinance of the Ministry of the Republic of the Republic of Korea."

3. Whether the instant disposition is lawful

A. The plaintiff's assertion

1) Since the division of inherited property is retroactively effective at the time of commencement of inheritance, it constitutes grounds for ex post facto request for correction under Article 25-2 subparag. 4 of the Enforcement Decree of the Framework Act on National Taxes. Therefore, the instant disposition rejecting the Plaintiff’s request for correction

2) Preliminaryly, the instant disposition imposing comprehensive real estate holding tax on each of the instant land, which is not the Plaintiff’s statutory shares in inheritance, has significant and apparent defects.

B. Judgment on the main claim

1) Article 45-2(2) of the Framework Act on National Taxes provides that "if any of the following events occurs, a person who has filed a tax base return by the statutory deadline for filing the tax return or who has received the determination of the tax base and amount of national tax may request the determination or correction within three months from the date on which he/she becomes aware of the occurrence of the cause, regardless of the period stipulated in paragraph (1)." Article 45-2(2) of the Framework Act on National Taxes provides that "if the cause prescribed by Presidential Decree which is similar to those of subparagraphs 1 through 4 occurs after the statutory deadline for filing the relevant national tax return expires" (Article 25-2 of the Enforcement Decree of the Framework Act on National Taxes provides that "if the permission or other disposition of the government office related to the effect of the transaction or act, which is the basis for calculating the tax base and amount of tax, has been revoked by the exercise of the right to cancel the relevant contract, or where the relevant cause has been cancelled or cancelled by any inevitable reason (Article 25-2 of the Enforcement Decree of the Framework Act on National Taxes)."

2) In light of the following circumstances acknowledged by the aforementioned evidence and the purport of the entire pleadings, it is not permissible to request a correction of the comprehensive real estate holding tax already established on the ground that the person liable to pay the property tax of this case was changed according to the agreement on the division of inherited property of this case. Accordingly, the Plaintiff’s primary claim is without merit.

A) A tax claim relationship is determined by law on the requirements, procedures, etc. for its establishment. Therefore, if the taxation requirements prescribed by each tax law are met, the tax obligation is established, and the established tax obligation cannot be changed in principle. The change in the situation after the establishment of a tax obligation does not have retroactive effect on the tax claim and the obligation relationship, in principle, it is not allowed to change the tax claim relationship according to an agreement between individuals.

B) Article 107(2)2 of the former Local Tax Act provides that the main heir regardless of whether the registration of inheritance was made at the time of the commencement of the inheritance, and when the de facto owner was not reported, the main heir is the taxpayer of the property tax regardless of whether the registration of inheritance was made or not. The above provision appears to the purport to ensure the stability of legal relations through the prompt determination of the taxpayer by imposing the property tax liability on the main heir, as it is impossible to identify the taxpayer in the event the de facto owner was not reported without performing the registration of inheritance (Article 1015 of the Civil Act provides that the division of inherited property is retroactively effective at the time of the commencement of the inheritance, but Article 1015 of the

C) In addition, the principal heir under Article 107(2)2 of the former Local Tax Act may escape from the liability for property tax in cases where he/she files a report with the head of the local government having jurisdiction over his/her location within 10 days from the tax base date pursuant to Article 120(1) of the former Local Tax Act, along with evidentiary materials indicating that he/she is not the actual owner. Therefore, insofar as the liability for property tax payment is effective due to the foregoing filing of a report without undergoing such procedures, if the comprehensive real estate holding tax already imposed due to the agreement on division of inherited property

C. Determination on the conjunctive claim

However, as seen earlier, each of the instant lands was not registered for inheritance as of June 1, 2016, and since the Plaintiff among the inheritors of the Sil UAA was extended from among those who have the largest inheritance shares, the Plaintiff becomes a taxpayer of comprehensive real estate holding tax on each of the instant lands. Therefore, as long as the Plaintiff becomes liable for tax pursuant to Article 12 of the Comprehensive Real Estate Holding Tax Act, Article 107 of the former Local Tax Act, and Article 53 of the former Enforcement Rule of the Local Tax Act, the Plaintiff’s assertion that the defect of imposing tax on each of the instant lands, which is not statutory inheritance shares, is significant and obvious, is without merit. Accordingly, the Plaintiff’s conjunctive claim is without merit.

4. Conclusion

Therefore, all of the plaintiff's main and ancillary claims are dismissed. It is so decided as per Disposition.