Korea's National Tax Service Begins Preparation for Virtual Asset Taxation
Korea's National Tax Service has officially launched preparations for virtual asset taxation, aiming for implementation in January 2027 and preparing for comprehensive income tax declarations in May 2028.
According to the current income tax law, income from the transfer and leasing of virtual assets will be classified as "other income," with a tax rate of 22% applied to annual earnings exceeding 2.5 million KRW, affecting approximately 13.26 million people.
In terms of market mechanisms, Korean crypto investors will accelerate tax compliance planning and reporting, with significantly improved transaction transparency following mandatory reporting of exchange data. Compliance platforms and tax services will benefit, while high-net-worth individuals may seek to evade taxes through overseas migration or asset structuring, concentrating capital in crypto services that are clear and compliant with tax regulations.
Source: Public Information
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Korea's National Tax Service plans to obtain trading data from major exchanges such as Upbit, Bithumb, Coinone, Korbit, and Gopax starting next year, and aims to launch a comprehensive virtual asset analysis system within the year. This marks a shift from a relatively lenient regulatory environment to a comprehensive taxation phase in Korea.
In terms of capital pathways, the National Tax Service will focus resources on data integration systems and AI analysis tools, requiring exchanges to cooperate in reporting user trading records. The strategic goal is to achieve fiscal revenue through the 22% tax rate while reducing capital outflow and tax evasion risks. However, disputes regarding specific taxation standards, overseas asset declarations, and potential outflows of high-net-worth individuals continue.
Similar cases include the strengthening of crypto asset tax declarations in multiple countries by 2025 (such as the EU DAC8 and the US capital gains tax enhancement), as well as Korea's gradual implementation of stock capital gains tax; currently, Korea's virtual asset policy is in a critical preparatory stage transitioning from a gray area to standardized tax compliance.
Essentially, this represents a regulatory change: virtual asset income is formally incorporated into the comprehensive income tax system, with mechanisms in place to set annual income thresholds, bringing a large number of retail and institutional trading behaviors under taxation, leading to a shift in pricing power from a no-tax/low-tax crypto trading environment to compliant reporting platforms, tax service providers, and overseas tax-friendly jurisdictions, while accelerating the transformation of Korea's crypto ecosystem from reckless growth to transparency and institutional restructuring.