South Korea Plans To Implement 20% Tax on Bitcoin Profits

Beginning 1st January next year, South Korea will apply a twenty percent tax on Bitcoin and digital asset profits. The nation’s Ministry of Economy and Finance declared that gains made from both trading and holding virtual assets will be subject to the tax, as per a recent report published by the Korean Herald.

The crypto tax will be prompted when profits made from virtual assets surpass two and a half million won, or around twenty-three hundred USD. Profits generated up to this point will be exempted from taxation.

Earlier, South Korea aimed to apply the tax beginning in 2020. However, pushback from digital asset enthusiasts and activists saw the government postpone the enactment of the tax numerous times.

Notably, virtual assets received as part of an inheritance or as gifts, will also be taxed. Apropos the cryptocurrency gifts and bequests, the Herald mentioned,

“In such cases, the price of the asset will be calculated on the basis of the daily average price for one month before and one month after the date of the inheritance or gift.”

Here and now, it seems that 2022 is back in the cards once again. Ensuing South Korea’s acknowledgement of BTC as a financial asset, Bitcoin and other virtual assets might no longer be categorized as tax-free pastimes.