What changes from January 1, 2027?
The National Tax Service states that income from transferring or lending qualifying virtual assets will be treated as separate taxable other income for transactions occurring on or after January 1, 2027. The taxable amount is generally the consideration received, less the asset’s acquisition cost and related expenses. The stated basic deduction is KRW 2.5 million per year, and the listed tax rate is 20%.
The regime was originally scheduled earlier but was postponed by a December 2024 amendment to the Income Tax Act. That means taxpayers should distinguish between the legal position for transactions completed before January 1, 2027, and transactions completed on or after that date.
How the taxable amount is calculated
The NTS describes the general calculation as:
- Sale or lending proceeds;
- Minus the actual acquisition cost;
- Minus qualifying acquisition and disposal expenses, such as transaction fees;
- Less the annual basic deduction, where applicable.
The NTS also describes a limited deemed-expense approach where the actual acquisition cost of virtual assets acquired after taxation begins cannot be confirmed. A percentage of the disposal proceeds, up to the permitted ceiling, may be treated as necessary expenses under the applicable rules. This should not be treated as permission to estimate casually: the taxpayer must first determine whether the documentation problem meets the relevant criteria.
Practical example
Assume an individual sells qualifying virtual assets in 2027 for KRW 30 million. Documented acquisition cost and related costs total KRW 20 million, producing a preliminary gain of KRW 10 million. After the KRW 2.5 million basic deduction, the taxable base would be KRW 7.5 million under the simplified example. Applying the stated 20% rate would produce KRW 1.5 million of national income tax before considering any other legally relevant adjustments.
This is only an illustration. Actual results can depend on the asset classification, valuation method, transaction history, residency, and implementing rules.
Recommended preparation checklist
- Export annual statements from every Korean and overseas exchange.
- Preserve purchase confirmations, deposit records, withdrawal records, and fee statements.
- Reconcile exchange records with self-custody wallets and blockchain transfers.
- Separate transfers between wallets from taxable disposals.
- Document the exchange rate and valuation method used for non-KRW transactions.
- Keep records showing whether activity was investment, lending, staking, or business activity.
- Review Korean tax residency before planning a move abroad.
Planning point for mobile taxpayers
A person who moves between countries should not assume that changing an exchange account or converting assets into stablecoins eliminates Korean tax issues. Residency, the timing of the disposal, and the legal character of the transaction remain central. Before a substantial relocation or liquidation, create a dated asset inventory and obtain advice on both Korean reporting and the destination country’s rules.