National Tax Service of South Korea checkswhether investors from the cryptocurrency market pay taxes. The office says it has already found around 2,400 people who tried to hide their earnings by buying cryptocurrencies such as Bitcoin (BTC) and Ether (ETH) on foreign exchanges. It has been added that cryptocurrency traders using these types of platforms will have to report their earnings and pay tax on them. The relevant regulations will enter into force in 2022.
The National Tax Service on the trail of cryptoinvestors
In turn, users of domestic platforms were told that their profits would be taxed at a flat rate of 20% if their profit exceeded $ 2,300 during the fiscal year.
Authorities also fear that citizens will try to avoid paying tax by bypassing national cryptocurrency exchanges. The latter are required to send user data to both the tax office and financial supervisory authorities and to mark suspicious transfers.
Accordingly, the tax authority concluded that the same rules would apply to citizens using cryptocurrency trading platforms abroad. Officials did not explain how this would be implemented.
Pay your taxes!
The National Tax Service added that all residents of the country with assets worth $ 441,924 or more – including cryptocurrencies – on foreign bank accounts, conventional asset trading platforms, or cryptocurrency exchanges at any time during the calendar year will have to declare their earnings and pay from tax.
The Korean tax office hoped to start taxing the profits generated by the cryptocurrency market from fall this year. The term was changed as local cryptocurrency exchanges claimed they did not have enough time to introduce the necessary compliance protocols into their systems.
It is worth adding that the South Korean market is growing in strength. According to data CoinMarketCap, the combined 24-hour volume of major national cryptocurrency exchanges – UPbit, Bithumb, Coinone and Korbit – totaled over $ 14.6 billion last Sunday. This shows that the interest in digital currencies in the country is growing strongly. As you can see, the actions of officials follow.