Early High Court Decision 2013Gu587 ( February 5, 2014)

It is judged that all or part of the acquisition fund such as real estate is subject to gift tax.

Since the income amount reported or taxed by the donee is substantially below the value of the remaining property excluding some real estate among the key assets, it is judged that the acquisition fund of the property is donated.

Articles 2 and 45 of the Inheritance Tax and Gift Tax Act

Daegu District Court 2014Guhap948 Disposition of Revocation of Imposition of Gift Tax

AA

BB

October 29, 2014

December 17, 2014

1. Of the instant lawsuit, the part exceeding KRW 195,233,050, among the disposition imposing gift tax on June 1, 2012.

In addition, all of the claims for revocation of the imposition of gift tax on March 7, 2014 and the claims for re-calculation of the amount of gift tax are dismissed.

2. AA’s remaining claims are dismissed.

3. Litigation Costs shall be borne by A.

Cheong-gu Office

1. BB performed against A on June 1, 2012, with respect to donations of 35,370,210 won on January 25, 2005, and with respect to A.

11. Donations of KRW 23,690,800, May 18, 2005, donations of KRW 108,847,200, and donations of August 4, 2006;

33,859,640 won, donations of 182,310,250 won on September 14, 2006, donations of 182,310,250 won on August 11, 2011, donations of 108,753,540 won on August 11, 201, and imposition of gift tax of 36,558,00 won on December 12, 201, shall be revoked, and re-calculated.

(F) On June 7, 2012, the written complaint appears to be a clerical error.

2. Correction of KRW 272,639,681, the gift tax of which was modified by BB on March 7, 2014;

The disposition is revoked (it appears that March 14, 2014, written in the written complaint, seems to be a clerical error).

1. Details of the disposition;

A.CC is a person operating 'DO' with a 'DO' nationwide, and AA was married withCC on January 7, 1981.

B. As a result of the FF’s investigation into the gift tax (F) on the acquisition of assets by AA on January 31, 201 to April 9, 201, AA confirmed that the following real estate and golf membership acquired on September 2, 2003 or December 12, 201, and determined the amount of gift tax as KRW 529,389,640, by deeming that A was donated all of the assets acquired fromCC pursuant to Article 45(1) of the Inheritance Tax and Gift Tax Act (hereinafter “Inheritance Tax and Gift Tax Act”) and Article 34(1) of the Enforcement Decree of the same Act, AA determined the amount of gift tax as KRW 529,389,640, and notified B.

(c) BB For A on June 1, 2012, 35,370,210 won for donations made on January 25, 2005;

The gift tax was imposed on April 11, 200, KRW 23,690,80, KRW 108,847,200, KRW 108,50, May 18, 2005, KRW 33,859,640, KRW 182,310,250, KRW 10,250, KRW 108,753,540, KRW 36,58,00, and KRW 529,389,640, and KRW 640 (hereinafter referred to as “original disposition”).

(d) AA served a notice on June 7, 2012, and filed an objection on September 3, 2012, but avoided.

The Court decided to dismiss an objection on October 15, 2012. AA made an appeal on January 14, 2013.

【Decision of the Tax Tribunal (Evidence A No. 2)

BB Gift tax imposed on A on January 25, 2005 by A on June 7, 2012, 35,370,210 won, and 4.

11. Donations of KRW 23,690,800, May 18, 2005, donations of KRW 108,847,200, and donations of August 4, 2006;

33,859,640 won, donations of 182,310,250 won on September 14, 2006, donations of 182,310,250 won on August 11, 2011, donations of 108,753,540 won on August 11, 201, and imposition of 36,558,00 won on December 12, 201;

1. 60,587,200 won for acquisition of a building 398.6 square meters located in an OO-gun OO-gun; and

OO OOOO OO 1,042 square meters, 57 square meters in the same OO OO

O 2,475 square meters, 1,924 square meters prior to the same RiO, and 575 square meters prior to the same RiO

The time of donation of gold 280,000,000 won shall be April 11, 2011; OOOO-gun OO

A gift tax shall be levied on KRW 37,836,800,000 for acquisition of 1,324.4 square meters of a factory located in an O or the same O

the tax base and amount to be excluded from the taxable value shall be corrected;

2. The remaining claims are dismissed, and ① 1/2 of the funds for acquiring the real estate at issue is jointly contributed property to the couple, and the relevant shares should be excluded from the donated property. ② Since the 2nd real estate was acquired with loans from AA, it should be excluded from the donated property. ③ The 3rd real estate was acquired with the deposit money from AA, and thus should be excluded from the donated property. The Tax Tribunal decided on February 5, 2014 as follows.

E. On March 7, 2014, BB changed the timing of donation of funds to acquire 2 real estate at issue, and three copies of the issues.

Gift tax on A by revising the tax amount, such as the exclusion of the acquisition fund of movable property from the taxable value.

195,233,050 won = 529,389,640 won - 33,859,640 won (reduction on August 4, 2006) - 9,139,500 won

on December 12, 201, 108,847,200 won (the partial reduction of donations on May 18, 2005) -

Reduction or correction disposition (hereinafter referred to as "reduction of donation on September 14, 2006") shall be reduced or exempted from 182,310,250 won (reduction of donation on September 14, 2006).

In this case, "the disposition of this case" was made.

Facts without any dispute, Gap's 2, 10 evidence, Eul's 1 through 10, the purport of the whole pleadings, and the purport of the whole pleadings.

2. Of the instant lawsuits, the part exceeding KRW 195,233,050, among the original dispositions, and the part requesting revocation of the disposition imposing gift tax as of March 7, 2014 and whether the part claiming for re-calculation of the amount of gift tax is legitimate

ex officio, BB made an initial disposition against A on June 1, 2012, and tax appellate court after the first disposition against A.

According to the decision of partial acceptance of the claim of the board of directors, on March 7, 2014, the decision of revocation of the gift tax reduction (the amount of gift tax reduced from KRW 529,389,640 to KRW 195,233,050) was made against A on March 7, 2014. As seen earlier, ① the part of the claim for revocation as to the portion exceeding KRW 195,233,050 in the initial disposition due to the correction of the amount of reduction to the Plaintiff is inappropriate as the subject of revocation is not the subject of revocation. ② The subject of appeal is the original disposition that remains not revoked by the decision of revocation of the reduction of the amount of reduction, i.e., the part of the claim for revocation itself is inappropriate. ③ The part of the claim for revocation of the correction of the amount of reduction itself is also the subject of an administrative disposition under the Administrative Litigation Act, and ③ the court seeking a judgment to directly form an administrative disposition having the same effect as the administrative agency’s given a certain administrative disposition is not permitted (see Supreme Court Decision 97NuB, etc.).

Therefore, the portion exceeding KRW 195,233,050 among the lawsuit in this case and March 7, 2014

The revocation of the imposition of gift tax and the claim for re-payment of gift tax are all unlawful.

3. Whether the instant disposition is lawful

A. A’s assertion

AA andCC operated an OO agency on a O-year basis, established 'OOO' and started franchise business, etc. AA had actually performed a joint project, such as internal affairs such as material and fund management, andCC had been in charge of external affairs such as business expansion and customer management. Therefore, since assets other than the 2 real estate out of the key assets are acquired through a joint project between AA and O, 1/2 of them should be deemed to have been acquired through the self-reliance of AA.

The title trust will be held in the AA after it acquired the above property with its own funds.

Even if there is no proof that the title trust between husband and wife is valid under the current law, and that the said title trust was made for tax evasion, theCC’s acquisition fund can be prevented, unless it is proved that the said title trust was made for tax evasion.

gift tax is imposed on AA by deeming that it was donated to it. The principle of no taxation without law and taxation requirements

It violates the principle of clarity, etc.

On the other hand, A acquired 2 real estate on April 11, 2005 and May 18, 2005, and the price therefor.

To prepare, one copy of the issue to the Obank Co., Ltd. (hereinafter referred to as the "OO") on April 11, 2005

To provide movable property as security and to borrow KRW 350 million. After this,CC around 2006

When a business fund has been required by establishing a “OOOO” business expansion plan, AA has been loaned KRW 300 million from NA to CC as security for some of the key 2 real estate on October 22, 2007. On April 11, 2011,CC repaid KRW 350 million loans from OO bank on April 11, 2005 by repaying the above loan amount of KRW 300 million. Accordingly, this is merely a repayment of debt, and thus, it cannot be deemed as a monetary donation to AA.

(b) Related statutes;

It is as shown in the attached Table related statutes.

C. Determination

1) Article 45(1) of the Inheritance Tax and Gift Tax Act provides that where it is difficult to recognize that a person acquired an asset by his/her own means in view of his/her occupation, age, income, property condition, etc., as prescribed by Presidential Decree, the acquisition fund of the asset shall be donated to the person who acquired

It stipulates that it shall be deemed as the value of the property acquired by the purchaser, and the Enforcement Decree of the same Act

Article 34 (1) and (2) of the Act provides that "cases prescribed by Presidential Decree" refers to cases where the sum of the amounts verified by each of the following subparagraphs falls short of the value of the acquired property or the amount of the obligation repaid," and Article 34 (1) of the Act provides that "the amount of income already declared or taxed, the value of the inherited or donated property" (Article 2) and "the value of the inherited or donated property" (Article 16 (1) of the Framework Act on National Taxes), "the amount of money or the obligation received in return for the disposal of the property, and the amount of money acquired in return for the disposal of the property or used directly for the repayment of the obligation concerned" (Article 34 (1) of the Act provides that if a person liable for tax payment keeps and records a book pursuant to

On the other hand, the burden of proving the facts of taxation requirement is generally the burden of taxation.

tax requirements in light of the empirical rule in a specific proceeding; or

If the presumption of facts revealed, unless the other party proves that the pertinent facts at issue are not eligible for the application of the empirical rule, it cannot be readily concluded that the pertinent taxation disposition was an unlawful disposition that failed to meet the taxation requirements (see Supreme Court Decision 2006Du6604, Feb. 22, 2007).

In addition, during the tax investigation conducted by the tax authority, certain parts of the transaction from the taxpayer

(1) If a written confirmation has been prepared by the person who is a processing transaction, the author's intent;

specific facts due to forced preparation or lack of the content thereof, etc. against

Except in extenuating circumstances, such as that it is difficult to take it as supporting material for the confirmation, the evidence of the confirmation shall only be used.

It is difficult to readily deny (see, e.g., Supreme Court Decision 2001Du2560, Dec. 6, 2002).

2) The purport of the entire pleadings is as follows: (a) the above facts of recognition, relevant laws and regulations, and each entry of evidence Nos. 11 and 12

In light of the following circumstances known in the aggregate, excluding the key three real estate among the key assets

Since it is reasonable to see that all of the remaining assets acquired have been donated to AA, it is reasonable to see thatCC has donated it

The instant disposition is lawful, and all or part of the acquisition fund is not subject to gift tax.

The above argument of AA is without merit.

1. At the time of investigation into BB’s funding sources, on March 13, 2012,CC prepared a written confirmation and a written statement that the acquiring amount of outstanding assets at issue is one’s own funds, and the main contents of the written statement (No. 12) are as follows:

○ On September 2, 2003, in order to use it as an OO store and office on September 2, 2003, O acquired an amount of KRW 100 million in the name of AA with an OO-gun O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O

○ On April 11, 2005, constructing a new building for warehouse and manufacturing establishment on the above land.

A direct construction has been made to the business operators in each field, and new construction and construction has been made at their own funds.

○ On January 25, 2005, OOO-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-O-150

The land size was acquired in KRW 300 million, and acquired with his own funds.

○ On May 18, 2005, OOO-gun OOO-type OO-type O-type 1,042§³ other than 1,042§³

4 Parcels (as the dispute 2 real estate) were acquired in the amount of KRW 280,000,000,000, and it was acquired with the funds of the principal.

○ On September 14, 2006, 000 OOO-gun 1,324 m2.4 m2

On August 11, 2011, the above building was extended to 672m2 square meters, and it was appropriated for one's own funds.

○ 2011. 12. 12. QQ으로부터 OO OO군 OO면 OO리 OO 답 700㎡

B acquired at KRW 75 million, and acquired at its own funds.

○ acquiring from K on August 4, 2006 the OCC golf course membership in KRW 69 million.

on April 7, 2008, the OCC membership was purchased in the amount of KRW 97 million, all of which are this.

The acquisition was made with the funds of the person.

② At around 2012, AA asserts that, under the circumstance whereCC was accused of having evaded taxes equivalent to KRW 18.1 billion from the tax authority, it is highly imminent that it prepared the above confirmation and written statement differently from facts in the expectation that, if it made the maximum cooperation with B, etc. regarding the imposition of gift tax of this case relatively weak amount of KRW 18.1 billion, it would not be adequately resolved. However, there is insufficient evidence to acknowledge that the above confirmation and written statement were drafted by force againstCC’s will or that it was written differently from facts, solely on the basis of the statements in subparagraphs 8 through 10, 11-1, 11-1, 2, 12-1 through 37, and there is no other evidence to prove otherwise.

③ AA’s revenue and income amount from 2004 to 2011 are as follows, and around August 2006, it verifiedCC as a real business operator and corrected the name of the business operator as “CC.” Therefore, if an O-related business income is excluded, income during the pertinent period is merely about KRW 93 million. This is a very small amount compared with the total acquisition value of the pertinent assets, and the requirements for “the presumption of donation of funds to acquire property” under Article 45(1) of the Inheritance Tax and Gift Tax Act and Article 34(1) of the Enforcement Decree of the same Act are satisfied.

3) AA, even ifCC has held a title trust of the key assets, under the name of the married couple.

The acquisition fund shall not be deemed to have been donated to AA by theCC, as long as the trust has been effective.

Since it is alleged that it is the health account, Article 45(1) of the Inheritance Tax and Gift Tax Act, and Article 34(1) of the Enforcement Decree of the same Act

The amount of income reported or taxed is less than the value of the property acquired or the amount of debt repayment;

the property shall be presumed to have been donated to the person who acquired the property.

According to the above facts, the income amount reported or taxed by A is among the key assets.

Since it is substantially short of the value of the remaining property other than the 3rd real property, AA shall take charge of such property.

Therefore, the AA’s above assertion is without merit.

4) With respect to a person who acquired 2 real estate at issue, AA has borrowed 300 million won from Nonghyup on October 22, 2007, and it has been lent toCC. Accordingly, on April 11, 201,CC asserted that repayment of 300 million won was merely a debt repayment, but it is not a donation. However, there is no evidence to acknowledge that AA has lent 300 million won toCC. Rather, the Tax Tribunal accepted the claim of AA to the effect that it acquired 2 real estate as an OO bank loan on April 11, 2005, not only the acquisition time of 2 real estate, but also the transfer time of 2 real estate acquired 2 real estate at issue and that it should be deemed as April 11, 201 when it repaid 30 million won to the above loan, and accordingly, BB merely changed the amount of 200 on April 11, 2005 and 201.

4. Conclusion

Thus, the portion exceeding 195,233,050 won out of the original disposition among the lawsuit in this case and March 7, 2012

The revocation of the disposition imposing gift tax and the claim for re-calculation of the amount of gift tax are all unlawful.

AA's remaining claims are dismissed as without merit. It is so decided as per Disposition by the assent of all participating Justices.

(c)