South Korea to delay cryptocurrency tax rule to January 2022

Reports suggest that South Korea plans to delay the commencement of a crypto income tax rule by three months to January 2022..

By · Nov 26, 2020 . 5min read

South Korea cryptocurrency tax rule latest news

South Korea plans to delay the implementation of its crypto income tax rules to January 2022. In accordance with the report by local media outlet DongA, the decision to postpone the implementation date by three months from the original October date to January of the following year has been advocated by lawmakers referring to the country’s National Assembly.

South Korea to tax crypto gains by 20%

Earlier, South Korea intended to implement a 20% income tax on cryptocurrency profits via a bill introduced by the country’s legislative body. The tariffs will be administered on capital gains of approximately 2.5 million South Korean Won ($2262.49). The recommended crypto tax bill came with the boom of building cryptocurrency exchanges along with the increase in crypto-related transactions and activities in South Korea.

However, the tax rules before were to be applicable in October 2021. The delay in South Korea’s crypto rule is owing to the cryptocurrency exchanges that need time to adjust to the tax reporting system. According to the blog post, the approved “Specific Financial Information Act” will be implemented from March next year. Thus, crypto exchanges must also achieve a reporting system by September 2021. It is for possessing real names of deposit and withdrawal accounts. This should complete by September 2021, before onboarding the new crypto tax extension. There is no evidence that the recommended extension will change this deadline at the time of publication.

Through its law enforcement agencies, South Korea has gained fame for clamping down cryptocurrency exchanges with suspicious financial transactions. The Korean police raided Bithumb’s office over two times for false allegations upon the Chairman of crypto exchange. The raid is in line with a $25 million token sale that Bithumb hosted. The promotion of token took place as Bithumb’s native token. It ultimately rolled out to be a high scale fraud that caused investor losses worth $25 million.

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