Cho Jae-2016-China-2598 ( December 29, 2017)

Whether the expenses of the lien are necessary expenses

Generally, the deduction of necessary expenses is not only favorable to the taxpayer, but also the facts that form the basis of necessary expenses are within the control area of the taxpayer and the burden of proof is the taxpayer.

Article 100 of the Income Tax Act

Incheon District Court 2018Gudan5035 Revocation of Disposition of Imposing Capital Gains Tax

○ ○

○ Head of tax office

November 27, 2018

December 11, 2018

1. The cancellation part of capital gains tax of KRW 172,840,660 among the lawsuit in this case shall be dismissed.

2. The plaintiff's remaining claims are dismissed.

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

Cheong-gu Office

The Defendant’s disposition of imposition of capital gains tax of KRW 190,760,260 against the Plaintiff on April 1, 2016 is revoked.

1. Details of the disposition;

(a) Particulars of the acquisition and sale of real estate;

1) On August 26, 2010, the Plaintiff: (a) acquired the instant building by auction at KRW 1.22 billion; (b) on December 10, 2010, the instant building was divided into KRW 201,000,000,000; (c) on December 10, 201, ○○○○○-dong 10-11 site (hereinafter “instant land”); and (d) the instant building was divided into the instant building at KRW 1.2 billion; and (e) on December 10, 2010, the instant building was divided into KRW 201 (hereinafter “instant housing”); (e) KRW 101, 201, non-201, non-202, and non-202 (other than the instant housing, referred to as “the remaining three commercial buildings”).

2) On December 10, 2010, the Plaintiff transferred the instant housing to Western ○○○ on the registry, and filed a report on the transfer income tax of KRW 600 million on March 8, 2012, the transfer value of which is KRW 598,197,090.

(b) Primary disposition:

1) On June 3, 2013, the Defendant conducted a tax investigation, and conducted a decision to notify the transfer value of KRW 700 million, and the acquisition value of KRW 383,040,600, and the transfer income tax of KRW 195,80,850 (including additional tax) for the year 2010 (hereinafter “the first disposition”).

2) On April 8, 2014, the Plaintiff filed an appeal with the Tax Tribunal for adjudication, and received a decision of partial recognition that the transfer value was reduced to 600 million won. The Defendant, prior to the said decision, reduced 11,089,200 won in the first disposition, including necessary expenses confirmed by addition, on March 4, 2014. On May 22, 2014, the Defendant made an ex officio reduction of 65,515,000 won in accordance with the decision of partial acceptance by the Tax Tribunal.

(c) Secondary imposition.

1) In a civil lawsuit seeking the payment of the amount of agreement on the resolution of the right of retention filed by ○○○ Co., Ltd. (Seoul District Court Branch Decision 2014Gahap663 Decided 2014 Gohap663), “the Plaintiff shall pay KRW 320 million to ○○○, Inc. by June 30, 2015” upon receipt of the decision of recommending settlement as of October 29, 2014, the Plaintiff filed an application for rectification seeking the refund of capital gains tax on December 18, 2014, and the Defendant issued a disposition to impose capital gains tax on April 1, 2016 upon finding any error that occurred in the process of calculating necessary expenses at the time of the first tax disposition (hereinafter referred to as “second disposition”).

2) The Plaintiff appealed and filed an appeal. The Defendant, in the course of the appeal, corrected the amount of KRW 14,482,180 on July 15, 2016, including the acquisition value, which was additionally confirmed to have been paid by the Plaintiff to the confined authority. The Tax Tribunal dismissed the amount of KRW 195,804,850 on December 29, 2017, and dismissed the remainder of the appeal.

[Ground of Recognition] Unsatisfy, Gap evidence 1 to 3, Eul evidence 1 to 11, oral argument

The purport of the whole

2. The plaintiff's assertion

The Defendant considered the acquisition value of the instant real estate as 26.13% of the appraised value of the instant real estate based on the appraisal report on the instant real estate, and calculated the acquisition value as 378,867,064 won by reflecting the lien amount paid by the Plaintiff. Furthermore, as of April 2013, it is reasonable to compute the acquisition value in proportion to the transfer value of the instant real estate and the remaining commercial buildings based on the transfer value of the instant real estate at the time of the secondary disposition. Since the Plaintiff disposed of the remaining commercial buildings at a voluntary auction around 890,80,00 won, the ratio of the instant housing to the total transfer value should be 40% (60 million won + 890,800,000 won) from the total transfer value (60.40 billion won), 579,970,970,480 won from the aggregate of the acquisition value of the instant real estate and the sales value of the instant real estate at KRW 2606,3606,4600 won from the previous disposition of 2063 billion.

3. Whether the revocation of the first disposition among the instant lawsuits is legitimate

Article 22-2(1) of the former Framework Act on National Taxes (amended by Act No. 911, Jan. 1, 2010; hereinafter the same) provides that “an amendment that increases the amount of tax initially determined under tax-related Acts shall not affect the rights and obligations under this Act or other tax-related Acts with respect to the amount of tax initially determined.” In light of the language and text of the aforementioned provision and the main legislative purport thereof, even if a correction disposition is made, it is intended to restrict any objection to the amount of tax initially determined in the initial return or determination due to the lapse of the objection period, etc., the revocation of the amount of tax cannot be claimed in the initial return or determination, and the revocation of the increase may be claimed only within the limit of the amount of tax increased by the correction disposition (see, e.g., Supreme Court Decision 2010Du9808, Apr

According to these legal principles, since the portion of KRW 195,80,80, which is the first tax disposition, for the capital gains tax for the year 2010, was reduced by 11,089,200 on March 4, 2014, and the amount of KRW 65,515,00 upon the decision of the Tax Tribunal was reduced by 119,20,650 on May 22, 2014, which remains 119,20,650 on the ground that the Plaintiff had filed an administrative litigation within 90 days from the date of receipt of notice of the decision on the request for adjudgment on April 8, 2014, the Plaintiff still rejected the portion of the first tax disposition for which the Plaintiff sought revocation of the said increase ex officio, regardless of the procedure of ex officio reduction or exemption of KRW 172,840,660 on the ground that the Plaintiff’s claim for revocation of the said increase was unlawful, excluding the amount of tax ex officio reduction or exemption.

4. Whether the secondary disposition is lawful.

A. Acquisition value portion

Article 100 of the former Income Tax Act (amended by Act No. 10408, Jan. 1, 2011) provides that where a land and a building are acquired en bloc, each of them shall be separated and entered, and where the distinction is unclear, it shall be calculated in accordance with Presidential Decree. Article 166 (6) of the former Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 22580, Jan. 1, 201) provides that the calculated method shall be calculated in accordance with the proviso of Article 48-2 (4) of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 22578, Jan. 1, 2011). Article 48-2 (4) proviso of the Enforcement Decree of the Value-Added Tax Act provides that the calculated method shall be in

According to the evidence above, the defendant calculated the acquisition value of the house of this case as KRW 396,635,527 by applying the appraisal value ratio (26.13%) of this case to KRW 1,515,926,200,000,000,000 won for the successful bid price of this case and KRW 1,22,00,000,000,000 from July 15, 2016, which is the date of the final decision of correction of capital gains tax on the transfer of the house of this case related to the transfer of this case. This is justifiable in accordance with the above relevant laws and regulations. Although the plaintiff asserted that the transfer value of the house of this case of this case and the remaining commercial buildings of this case should be calculated by calculating the sales value based on the transfer value of the house of this case and the remaining commercial buildings of this case, not only the time of acquisition but also the ratio of the sale value at the time of transfer, and there is no reasonable ground to do so.

B. Necessary expenses portion

In general, deduction of necessary expenses is not only favorable to taxpayers, but also most of the facts that form the basis of necessary expenses are located within the control area of taxpayers, so the tax authority is difficult to prove, so if it is reasonable to have the taxpayer prove in consideration of difficulty in proof or equity between the parties, the necessity of proof shall return to the taxpayer. As such, it is difficult to accept as long as the Plaintiff did not submit objective data to recognize that the Plaintiff paid 663,426,200 won with the lien agreement.

5. Conclusion

Therefore, the part claiming the cancellation of the part of KRW 172,840,660, which is alleged to be remaining in accordance with the first disposition among the lawsuit of this case is unlawful. Thus, it is dismissed. The remaining claim of the plaintiff is dismissed as it is without merit. It is so decided as per Disposition.