S.Korea Launches Tax on Cryto Exchanges

January 23, 2018 Taxation in South Korea

Cryptocurrency tax South KoreaSEOUL – Cryptocurrency exchanges in South Korea are about to feel a tax sting, as the government steps up to control the country’s rampant coin market.

Earlier this week the government of South Korea announced that cryptocurrency exchanges in the country will have to pay income taxes, and, also, that the income taxes will apply retroactively to previous profits.

Cryptocurrency exchanges will face a 22 percent tax on corporate profits and an additional 2.2 percent local income tax.

However, the tax will only apply if the exchange saw an annual income exceeding KRW 20 billion.

The taxes will not only apply to future profits but also to those profits garnered over the last year.

The corporate income tax will need to be paid by March this year, while the local income tax will be due in April.

Following the implementation of the tax, the most prominent cryptocurrency exchange in South Korea, Bithumb, would need to pay approximately KWR 60 billion in taxes.

The new taxes are part of the government’s ongoing efforts to reign in cryptocurrencies, which have proven to be wildly popular in the country.