4 June, 2021
South Korea will levy 20% capital gains tax on crypto transactions from next year, government announced last week, despite investor uproar asking the government to delay the plan.
Gains from cryptocurrency transactions will be classified as “miscellaneous income” and will be subject to a 20 percent tax starting next year. Virtual asset gains must be reported when filing for general income taxes in May 2023, according to local media reports.
Seoul is known for its stringent stance on cryptocurrencies, with the government keeping a close eye on crypto transactions amidst growing popularity of crypto assets amongst its citizens.
About 60 cryptocurrency exchanges were operating in South Korea as of May 20.
South Korean regulators also recently met with nearly 20 crypto exchanges.
This is the first time that the Financial Services Commission (FSC) and the Korean Financial Intelligence Unit (KoFIU) has gathered the country’s top 20 crypto business operators.
The meeting was called to “provide information and consulting on business reporting requirement procedures.”