- South Korea will proceed with virtual asset taxation starting January 2027.
- Moon Kyung-ho confirmed the Ministry of Finance and Economy’s position during a forum at the National Assembly.
- A 22% tax rate will apply to virtual asset income exceeding 2.5 million won ($1,721) as of 11:15 UTC on May 7, 2026.
- The National Tax Service is preparing a notice on detailed taxation measures.
- The notice is expected to be announced for legislative review within this year.
South Korea’s Ministry of Finance and Economy confirmed that virtual asset taxation will proceed as scheduled from January next year. Moon Kyung-ho, Director of the Income Taxation Division at the Ministry of Finance and Economy, made the remarks on the afternoon of May 7 during the “Emergency Review Forum on Virtual Asset Taxation” held at the National Assembly Members’ Office Building in Yeouido, Seoul. The forum was hosted by Rep. Park Soo-young of the People Power Party and the Korea Tax Policy Association.
Director Moon stated that “we will proceed with virtual asset taxation as scheduled in January next year,” describing the remarks as the Ministry’s official position. This marked the first public expression of the Ministry of Finance and Economy’s stance regarding virtual asset taxation.
National Tax Service Preparing Detailed Taxation Notice
Regarding specific taxation measures, Director Moon said the National Tax Service is currently preparing a related notice. He stated that the National Tax Service has been holding several meetings with the country’s five major virtual asset operators – Dunamu, Bithumb, Coinone, Korbit, and Gopax – to prepare the draft notice at a practical level.
According to Director Moon, the National Tax Service’s notice is expected to be announced for legislative review. After the forum, Director Moon met with reporters and clarified his earlier remarks regarding the timing of the notice. He said the expression “soon” could be misunderstood as suggesting the notice would be released immediately. He added that the implementation would occur within this year and that the National Tax Service notice is scheduled to take effect sometime this year, reported by edaily.
22% Tax Rate on Virtual Asset Income Above 2.5 Million Won ($1,721)
Under the current Income Tax Act, income generated from the transfer or lending of virtual assets will be classified as other income starting January 1 next year. A combined tax rate of 22% will apply to virtual asset income exceeding 2.5 million won ($1,721). The total rate includes 20% other income tax and 2% local income tax. The taxation is expected to apply to 13.26 million investors, based on cumulative Upbit membership data as of December last year.
Recently, South Korea announced plans to launch a blockchain-based deposit token pilot for government spending in the fourth quarter of 2026 under its regulatory sandbox program. The initiative will replace government purchasing cards for selected expenses with tokenized payments that support programmable spending controls and reduce the need for manual audits. The pilot will begin in Sejong City, with authorities considering broader nationwide expansion if the system demonstrates stronger oversight and measurable cost savings.
FAQs
1. When will South Korea start taxing virtual assets?
South Korea will begin taxing income from virtual assets starting January 1, 2027, according to the Ministry of Finance and Economy.
2. What is the tax rate on virtual asset income in South Korea?
A total tax rate of 22% will apply to virtual asset income exceeding 2.5 million won ($1,721). This includes 20% other income tax and 2% local income tax.
3. Which virtual asset activities will be taxed?
Under the current Income Tax Act, income generated from the transfer or lending of virtual assets will be classified as other income and taxed.
4. Which crypto exchanges are coordinating with South Korea’s National Tax Service?
The National Tax Service is holding meetings with Dunamu, Bithumb, Coinone, Korbit, and Gopax while preparing the taxation notice.
