Cho High Court Decision 201Do1187 (No. 02, 2011)

The legal spouse of a resident shall form a resident and a household regardless of whether he/she shares the same livelihood or not.

It is interpreted that a resident’s spouse constitutes a resident and a household solely based on the fact that he/she is the spouse, without asking whether he/she actually lives together and living together. Thus, even if a spouse is a legal spouse at the time of transfer of a house, even if the marital relationship has actually reached a failure, the resident

Article 89 of the Income Tax Act

2011Gudan22375 Revocation of Disposition of Imposing capital gains tax

KoreaA

Head of Seodaemun Tax Office

April 20, 2012

June 22, 2012

1. The plaintiff's claim is dismissed.

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

The Defendant’s disposition of imposing capital gains tax of KRW 000 for the year 2010 against the Plaintiff on January 7, 2011 is revoked.

1. Details of the disposition;

A. On August 3, 2005, the Plaintiff acquired and owned a house of 151.4 square meters and its ground 253.88 square meters (hereinafter collectively referred to as the “instant house”), and transferred it to MadD on March 19, 2010, and submitted a single house non-taxation report to the Defendant.

B. At the time of the Plaintiff’s transfer of the instant house, the Defendant: (a) deemed that the KimE, a legal spouse of the Plaintiff, owns 000 OE-dong 000 OE 000,000; and (b) deemed that the Plaintiff constitutes two houses for one household; and (c) issued the instant disposition to correct and notify the Plaintiff of KRW 000,000, capital gains tax attributed to the year 2010.

[Reasons for Recognition] The non-contentious facts, Gap evidence, and Eul evidence 1 to 3, and the purport of the whole pleadings

2. Whether the disposition is lawful;

A. The plaintiff's assertion

The plaintiff, who was married with Kim E in around 1968, actually divorced from May 197, and maintained de facto marital relations with the UPP from December 29, 197 to December 29, 197, and the GimE does not consent to divorce while maintaining its livelihood independently from the other households until now. Since KimE cannot be a family member living together with the plaintiff under the principle of substantial taxation, the plaintiff cannot be deemed to form one household provided for in Article 154 (1) of the Enforcement Decree of the Income Tax Act with the plaintiff. In addition, Article 154 (2) 2 of the same Act provides that the plaintiff shall be deemed to be one household in cases where his spouse dies or is divorced, and the divorce here should be interpreted not only in cases where the legal marital relationship is resolved, but also in cases where the plaintiff is in de facto divorced. Therefore, the disposition of this case based on the premise that the plaintiff is a two house owner at the time of transferring the housing of this case is unlawful.

B. Determination

Article 89 (1) 3 of the Income Tax Act (hereinafter referred to as the "Act") provides that "one house for one household prescribed by Presidential Decree (excluding expensive houses whose prices exceed the standard prescribed by Presidential Decree) and the appurtenant land within the area calculated by multiplying the area on which the building is built by the multiple rates prescribed by Presidential Decree (hereafter referred to as "land annexed to a house" in this Article) shall not be exempted from income tax on capital gains, and Article 154 (1) 3 of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 22580, Dec. 30, 2010) provides that "one house for one household prescribed by Presidential Decree" in Article 89 (1) 3 of the Act means that the resident and his spouse have no residential relationship with the other spouse at the time of the transfer, and if the spouse has no residential relationship with the other spouse at the time of the transfer, one household (hereinafter referred to as "one household" in this Article) that consists of two or more years long-term residential areas and two-term residential areas under the Housing Site Development Promotion Act.

3. Conclusion

Thus, the plaintiff's claim is dismissed as it is without merit.