Cryptocurrency
Korean gov’t mulls imposing 20% other income tax on cryptocurrency gains
As Pulse News reports, “The South Korean government may classify gains from cryptocurrency trading as other income such as lottery or prize winning, which is subject to 20 percent tax. “According to multiple sources from the government on Monday, the income tax department at the Ministry of Economy and Finance recently began reviewing taxation plans […]
As Pulse News reports, “The South Korean government may classify gains from cryptocurrency trading as other income such as lottery or prize winning, which is subject to 20 percent tax.
“According to multiple sources from the government on Monday, the income tax department at the Ministry of Economy and Finance recently began reviewing taxation plans for gains from virtual assets transaction. Previously, the project was under charge of property tax department, which oversees taxation on capital gains and gifts. The income tax department supervises taxation on incomes such as earned income, other income, and annuity income.
“This change has raised speculation among experts that the government has taken initial step on categorizing gains from trading cryptocurrencies such as bitcoins and ethereum as other income, not capital gains.
“A government official said that ‘the finance ministry is yet to finalize its direction but it surely has become more likely for the income from virtual asset trading to be labeled as other income, not as gains from transfer of capitals like real estate properties.’
“Under local tax law, other incomes include honorarium income, prize winnings such as money received from winning lottery and others that are infrequent, unusual and significant in size. Other income is subject to 20 percent tax on 40 percent of total other income. The remaining 60 percent of the income is tax deductible…”