South Korean tax authorities are relentlessly targeting cryptocurrency holders and making them pay taxes. The National Revenue Agency (NRA) has warned crypto traders that they must also declare their income from tokens they hold on currency exchanges.
No indication of how the agency will monitor the process.
According to MBC, the agency warned that South Koreans using foreign exchanges are also required to declare profits made. Meanwhile, holders of cryptocurrencies will have to pay the relevant taxes starting in 2022.
This year, the government is trying to pass new tax laws for cryptocurrencies. As Bitcoin.com News Service recently reported, the South Korean central government is expected to impose a 20% tax on the profits of crypto exchanges on domestic exchanges when profits exceed the $2,300 threshold.
The NTS is concerned that cryptocurrency providers are using foreign exchanges to avoid their tax obligations in South Korea.
However, there were no details on how it would oversee the process of bringing people into compliance with the tax rule to report profits from overseas crypto exchanges.
Domestic cryptocurrency exchanges are required under the new regulatory framework to submit trader data to both the financial regulator and the tax authorities. However, there is no legal way to force foreign cryptocurrency exchanges to do this.
According to the NTS, the same tax rules apply to transactions on these cryptocurrency exchanges without deep granularity.
Traders must pay tax on cryptocurrencies held abroad if they are worth $442,000 or more.
In addition, the tax authority reiterated that people who own assets worth 500 million won ($442,700) or more, including cryptocurrencies from foreign financial institutions such as banks or currency exchange platforms, must declare them in stamps.
Earlier this week, Bitcoin.com News also reported that the NTS has identified 2,416 people who allegedly hid their assets in cryptocurrencies to evade taxes.
According to the agency, the evaders used bitcoin (BTC), ethereum (ETG), pulse (CPR) and other cryptocurrency to evade authorities’ control.
What do you think about the warning from the National Revenue Service? Let us know your comments in the section below.
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