Early High Court Decision 2015Du1337 ( June 26, 2015)

Whether the amount of cash donation is donated property

If the donee is presumed to be a cash donation, it is reasonable to presume the amount deposited by the donee to the account in the name of the donor from the estimated amount of cash donation.

2014Guhap53316 Revocation of Disposition of Levying Inheritance Tax

Ann ○

○ Head of tax office

August 20, 2015

September 17, 2015

1. The Defendant’s disposition of imposing inheritance tax against the Plaintiff on November 30, 2012 is revoked.

2. The costs of the lawsuit are assessed against the defendant.

Cheong-gu Office

The same shall apply to the order.

1. Details of the disposition;

A. On April 27, 2011 and May 31, 2011, the Plaintiff received a total of KRW 790,759,683 in the Plaintiff’s account from Song○, the spouse of the Plaintiff, on two occasions, and reported and paid KRW 21,508,850 on August 24, 201.

B. As the Plaintiff died on June 6, 201, the Plaintiff reported and paid KRW 186,445,248 of the inheritance tax on December 31, 201 by adding the key amount to the donated property, and on November 30, 2012, the Defendant decided and imposed inheritance tax on the Plaintiff as KRW 185,308,512 (hereinafter “instant disposition”).

C. Around February 2013, the Plaintiff filed a claim for correction of gift tax on the ground that the Plaintiff received benefits from the Plaintiff’s position as a teacher to his/her spouse’s deposit account and received the return, which constitutes the Plaintiff’s proprietary property. However, the Defendant rendered a disposition of refusal to correct the amount on April 11, 2013.

D. Accordingly, the Plaintiff filed a request for trial on October 17, 2013 (hereinafter referred to as “the first request for trial”), and the Tax Tribunal rendered a decision to revoke the Defendant’s disposition rejecting the correction (hereinafter referred to as “the instant decision for trial”) based on the Plaintiff’s judgment that “532,763,824 won transferred from 191 to the spouse’s account from 2011 is recognized as the Plaintiff’s proprietary property,” and that “the Plaintiff received 70 million won or more from the Plaintiff’s account to the Plaintiff’s account,” and that from 1991 to 2011, money was transferred from the Plaintiff’s account to the Plaintiff’s account, while the details that was transferred from the spouse’s account to the Plaintiff’s account were rare.”

E. Accordingly, the Defendant’s correction of KRW 532,763,824, out of the key issues on April 3, 2014, excluded the amount of donation from the amount of donation, thereby reducing inheritance tax to KRW 71,238,880.

F. On the other hand, on November 14, 2014, after the filing of the instant lawsuit, the Plaintiff filed an application for rectification of inheritance tax on the ground that “the remainder 257,995,859 won, excluding the amount recognized in the decision on the instant case, is the Plaintiff’s inherent property, and thus, should be excluded from the taxable value of inherited property.” However, on December 4, 2014, the Plaintiff was subject to a disposition of refusal of correction from the Defendant, and the Plaintiff filed an appeal for adjudication (hereinafter referred to as “second appeal”), but was dismissed by the Tax Tribunal on June 26, 2015.

[Reasons for Recognition]

Facts without dispute, Gap evidence 1 through 4, Eul evidence 1 through 4 (including branch numbers in the case of additional number) and the purport of the whole pleadings

2. Determination on the defense prior to the merits

A. The defendant's defense

The defendant asserts that the lawsuit seeking revocation of the disposition of this case is unlawful, since the plaintiff merely rejected an appeal against the disposition of refusal to correct the gift tax and did not go through the pre-trial procedure.

B. Relevant legal principles

In tax litigation, the provisions of Articles 18(2) and (3) and 20 of the Administrative Litigation Act are not applied pursuant to the provisions of the Framework Act on National Taxes, but the provisions of Articles 18(2) and (3) and 20 of the same Act are not applicable. However, if two or more administrative dispositions are conducted in the course of step-by-step and development, and are related to each other, the tax authorities have changed the taxation disposition subject to such disposition during the course of the tax litigation and the grounds for illegality are common. In the event that several persons are subject to the same obligation by the same administrative disposition, or when one of the taxpayers is subject to the same obligation by the same administrative disposition, the Commissioner of the National Tax Service and the Tax Tribunal provided an opportunity to re-determine the basic facts and legal issues, and in addition, if there are justifiable grounds, such as where the taxpayer seems to be harsh to have caused the taxpayer to undergo the procedure of the preceding trial, the taxpayer may file an administrative lawsuit claiming the revocation of the taxation disposition without going through the procedure of the preceding trial

C. In the instant case:

Although inheritance tax and gift tax are different items of taxation, according to Articles 13(1), 14(1), and 25(1) of the Inheritance Tax and Gift Tax Act (hereinafter “Inheritance Tax and Gift Tax Act”), the tax base of inheritance is the amount obtained by subtracting the inheritance deduction amount from the taxable value of inherited property. Since the taxable value of inherited property is determined in advance after deducting public charges, etc. from the value of inherited property, the issue amount is whether it is donated property or not is directly related to the computation of inheritance tax amount as well as the legality of imposing gift tax.The object of which the Plaintiff sought revocation in the first trial decision was the Defendant’s refusal to rectify the gift tax reverted to year 201 (Evidence 1). Since the Tax Tribunal deliberated on whether the issue amount was donated by the Plaintiff’s spouse, it is merely the Plaintiff’s refusal of correction on the grounds that the above disposition should be excluded from the taxable value of inherited property, but it is also the Plaintiff’s refusal of correction on the grounds that the above amount should be determined by the Plaintiff’s prior determination of inheritance tax and gift tax amount.

In fact, the defendant refused to file a request for correction on the ground that the plaintiff's second appeal for revocation of the above rejection disposition is pending, and the Tax Tribunal has maintained the same judgment as to the amount exceeding the part recognized as the plaintiff's proprietary property in the adjudication decision of this case (Evidence 3 and 4) in light of the fact that the plaintiff's second appeal for revocation of the above rejection disposition is maintained (Evidence 3 and 4), it should be deemed that the plaintiff can seek revocation of the disposition of this case without undergoing a separate procedure for the previous trial.

3. Whether the instant disposition is lawful

A. The plaintiff's assertion

Of the key issues, the disposition of this case imposing the amount of inheritance tax calculated based on the Plaintiff’s inherent property as well as the remaining amount of KRW 257,95,859,859, which was recognized in the instant adjudication decision, should be revoked. Specifically, the disposition of this case should be revoked: ① the amount transferred to the Plaintiff’s account, among the money transferred to the Plaintiff’s spouse’s account, KRW 36,673,00, the amount of which is the excessive amount in the instant adjudication decision; ② the date of withdrawal from the Plaintiff’s account; ② the date of deposit from the Plaintiff’s account; ③ the date of deposit; ③ the amount deposited from the Plaintiff’s account; ③ KRW 32,186,00,000; ③ the amount deposited to the spouse’s account after the Plaintiff’s deposit was withdrawn from the Plaintiff’s account; ④ the sum of KRW 40,777,93, the sum of the money deposited to the Plaintiff’s spouse’s account; ⑤ the Plaintiff’s amount of interest accrued from the Plaintiff’s proprietary property 25195, 195.

B. Relevant statutes

The entries in the attached Table-related statutes are as follows.

C. Determination

1) Parts deemed as Plaintiff’s proprietary property

Of the Plaintiff’s assertion, ① transferred money from the Plaintiff’s account in 2008 and 2010 to the Plaintiff’s spouse’s account, but the amount of KRW 36,673,00, ② the date of deposit from the Plaintiff’s account, the amount of deposit deposited into the spouse’s account; ③ KRW 18,00,000, out of the amount deposited from the Plaintiff’s account and the amount deposited into the spouse’s account after termination; ④ KRW 7,951,80,00, which was the Plaintiff’s account’s account’s account’s account’s account’s account’s interest rate, and KRW 7,00,000,000, which was the Plaintiff’s account’s account’s account’s account’s account’s account’s account’s total interest rate, and KRW 7,810,880,000,000, which was the Plaintiff’s account’s account’s account’s account’s account’s account’s account’s account’s total interest rate, and KRW 7808, etc.

2) Parts not recognized as Plaintiff’s proprietary property

The following circumstances, which are acknowledged as comprehensively considering the overall purport of pleadings in the statements in the Evidence Nos. 6, 10, 13, 3, and 4, i.e., the Plaintiff’s deposit cancellation of a term deposit on June 10, 2002 and refund of KRW 20 million to the Plaintiff’s account on the same day, and deposit KRW 37 million with the spouse’s account on the same day, cannot be readily concluded that the deposit amount of KRW 37 million included KRW 15 million from the original Plaintiff’s account. ② Of the amount deposited with the spouse’s account, KRW 32,826,113 out of the total amount of money deposited as the Plaintiff’s spouse’s account was stated as the spouse’s spouse or the Plaintiff’s number, and it is difficult to conclude that the Plaintiff’s deposit was made solely on the ground that the Plaintiff’s employee was the spouse’s spouse, and even if the spouse did not withdraw the money from the Plaintiff’s account, it is difficult to conclude that the Plaintiff’s money was withdrawn from the Plaintiff’s account.

3) Sub-decisions

As seen earlier, among the disposition of this case, the reduced taxable value of inherited property includes the part recognized as the Plaintiff’s proprietary property. However, even if based on the allegations and materials submitted until the closing of argument, the reasonable amount of tax to be imposed cannot be calculated lawfully. Thus, the disposition of this case is completely revoked.

4. Conclusion

Therefore, the plaintiff's claim is reasonable, and it is decided as per Disposition.