[2024 Tax Revision] Virtual Asset Taxation Implementation Delayed for 2 More Years

If the '2024 Tax Law Amendment' announced by the government on the 25th is implemented, the taxation implementation date for virtual asset investment income will be postponed by two more years to after January 2027.

Virtual asset taxation refers to imposing taxes on income from virtual asset investments. It involves classifying income generated from transferring or lending virtual assets as other income and taxing it at a rate of 20% (22% including local tax), with a basic deduction of 2.5 million KRW applied.

The taxable amount of virtual asset income is calculated by deducting the acquisition cost, transaction fees, and other incidental expenses from the transfer price. When it is difficult to verify the actual acquisition cost, up to 50% of the transfer price will be applied as the acquisition cost.

On the 4th, after Bitcoin surpassed $60,000 and continued a gradual upward trend, the Bitcoin price was displayed on the electronic board at the Bithumb Customer Support Center in Seocho-gu, Seoul. Photo by Jinhyung Kang aymsdream@

With the passage of the Income Tax Act amendment in December 2022, taxation on virtual assets was confirmed. Virtual asset taxation was initially scheduled to be implemented in January 2022 but was postponed twice to 2023 and 2025 due to incomplete tax systems and infrastructure related to taxation.

Jeong Jeong-hoon, Director of the Tax Policy Bureau at the Ministry of Economy and Finance, explained, “Considering the need to review the enforcement results of related laws regulating investor protection and unfair market trading practices regarding virtual assets, we decided to postpone the taxation implementation by two years.”

While virtual asset taxation aligns with the basic taxation principle that 'taxes are levied where income exists,' voices have been raised that, since virtual assets have characteristics similar to stock trading, the taxation on virtual assets should also be postponed in consideration of the postponement of the Financial Investment Income Tax (FIIT) implementation for fairness.