Supreme Court finalizes cancellation of gift tax calculated using an appraisal value for a small building
The Supreme Court canceled the imposition of gift tax calculated through an appraisal of a small building. It cited the significant discrepancy between the appraised value and the market value, which could affect the gift-tax burden on small nonresidential properties.
The Supreme Court 2Division said it had finalized the plaintiffs' victory in the final appeal of a lawsuit filed by couple A and C against the heads of Yangcheon Tax Office and Samseong Tax Office seeking cancellation of the gift-tax imposition, 7 month 8 day. The panel determined that the relevant appraised value did not properly reflect the market value, the objective exchange value at the time of the gift.
The National Tax Service 2020 year introduced an appraisal program to prevent disguised gifts of nonresidential properties such as small buildings. Because it is difficult to confirm market values for small shops and buildings with few listings and transactions, the system calculates a standard value based on appraisals by two or more appraisal institutions.
Earlier that same year, 4 month 30 day, the Supreme Court issued a ruling recognizing the legality of the system itself. Instead of claiming that the system itself was unlawful, the plaintiff in this case challenged the gap between the appraised value calculated in the specific case and the actual exchange value.
The couple 2019year 7month received the disputed land and building as a gift from their parents and filed a lawsuit challenging the gift tax assessment based on the tax authorities’ appraisal. 2The trial court ruled in favor of the plaintiffs, and the Supreme Court upheld the ruling in full.
This ruling may serve as a direct precedent for the legal reasoning in other cases taxed in the same manner. However, the Supreme Court has recognized the legality of the system itself.
Sources: 뉴시스 경제
Bullstory synthesized this report from the linked sources. AI may have assisted the writing process. Check the original reports for factual confirmation.