National Tax Service Review Donation 2010-0016 (29 March 2010)

Benefits equivalent thereto have been donated by payment in lieu of the debt owed to a third party;

In a case where the Plaintiff received a third party’s debt from the deceased by payment in kind, and received a gift from the deceased, and it can only be clarified whether the taxable object is subject to taxation in a correct manner, it cannot be said that the defect is apparent even if it is serious, and thus, it cannot be deemed that the illegal taxation disposition that misleads the deceased into the fact of taxation requirements is null

Certificates of merit

National Rotations

Seoul Administrative Court 2010Guhap26643 ( October 12, 2011)

1. The plaintiff's claim is dismissed.

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

On August 17, 2009, the Defendant confirmed that each disposition imposing gift tax on the Plaintiff listed in the separate sheet No. 1, which was issued against the Plaintiff, is null and void.

1. Details of the disposition;

A. From May 6, 2009 to June 30, 2009, the director of the Daejeon Regional Tax Office conducted an inheritance tax investigation on the deceased Jeong (the death of April 30, 2008, hereinafter referred to as "the deceased") as the plaintiff's partner, and confirmed that the deceased paid the plaintiff's debt on October 12, 2006 and May 29, 2007 to the land owned by himself and notified the defendant thereof.

B. On August 17, 2009, pursuant to Articles 2 and 36 of the former Inheritance Tax and Gift Tax Act (amended by Act No. 8435 of May 17, 2007), the Defendant issued a disposition of imposition of gift tax of KRW 11,152,560 on the gift of October 12, 2006, KRW 32,370,480 on the gift of May 29, 2007, and KRW 10,043,270 on the gift of November 5, 2007 (hereinafter collectively referred to as "disposition of this case").

[Reasons for Recognition: Facts without dispute, Gap evidence 3, Eul evidence 1 to 3, Eul evidence 1 to 2, evidence 3-1 to 3, evidence 4-1 to 4, evidence 5-1, 2-2, and the purport of the whole pleadings]

2. Whether the instant disposition is lawful

A. Summary of the plaintiff's cause of claim

The plaintiff did not receive a donation of cash, etc. from the deceased, and the defendant's disposition of this case on a different premise is null and void as a matter of course.

(b) Related statutes;

Attached Form 2 is as shown in the relevant statutes.

(c) Fact of recognition;

1) The Plaintiff respectively borrowed 60,000,000 won from the largestB around 1999, and 50,000,000 won from the HighCC around 2002.

2) On November 11, 2004, the deceased prepared a confirmation document stating "in case where he succeeds or donates approximately 300 square meters to the plaintiff to the ○○○○○○○○○, ○○-gun, and about 900 square meters to the plaintiff, the deceased, the spouse of the largestB and highCC, he shall transfer 300 square meters among them to the largest B and KimD, and shall be given a certification (at the time of the plaintiff and the plaintiff's birth, Mad Had Do was signed and sealed by the above confirmation person and the guarantor). On October 12, 2006, 2006, the deceased completed the registration of ownership transfer to the leastB on the ○○○ 53-32 large 605 square meters to the ○○○○, the ○○○○-gun, the spouse of the deceased, and completed the registration of ownership transfer to the 3754 square meters on May 29, 2007.

3) Meanwhile, between April 13, 2006 and January 5, 2007, the Plaintiff received total of KRW 41,000,000 from the Deceased as follows, and paid KRW 3,00,000,000 to the Deceased on June 26, 2006.

[Ground for Recognition: Facts without dispute, entry of evidence No. 6-1 to 11, whether all pleadings are taken

D. Determination

According to the above facts, it is reasonable to view that the Plaintiff received a donation of KRW 38,00,000 in cash between April 13, 2006 and January 5, 2007, from the deceased, by receiving payment in lieu of the obligation owed to the largestB, etc. on October 12, 2006 and May 29, 2007, and that the Plaintiff received a donation of KRW 38,00,000 in cash between January 13, 206 and January 5, 2007. The mere entry of subparagraph 5 alone is insufficient to reverse the recognition.

In a case where there are objective circumstances that make it possible to mislead a person who does not have any factual relation, such as legal relations, income, or act, which are subject to taxation, the defect is significant and obvious, but in a case where there is any objective reason to mislead the person to be subject to taxation as to any legal relations or factual relations which are not subject to taxation, whether it is subject to taxation or not shall be accurately examined the factual relations, it cannot be said that the defect is apparent even if it is serious, and thus, it cannot be deemed that the illegal taxation that misleads the fact subject to taxation is null and void automatically (see, e.g., Supreme Court Decision 2001Du7268, Sept. 4, 2002). Thus, it cannot be deemed that there is a defect that the disposition in the instant case, which is based on the written statement, etc. of Jung EE, the plaintiff, who participated directly in the preparation of the deed signed and sealed by the plaintiff.

3. Conclusion

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