According to Odaily, the South Korean government has announced a delay in the implementation of its new virtual asset tax law until January 2025. This move is aimed at addressing issues related to the tax burden on individual investors and clarifying regulations.
From 2025, the law will cover income tax for residents, withholding tax for non-residents, and gift tax on virtual assets. Cryptocurrency investment income is classified as 'other income that should be taxed separately', and will not affect personal tax reduction policies. For cryptocurrency investors with an annual income exceeding 1 million Korean Won, personal tax reductions will remain unchanged.
The delay primarily affects the income tax of resident individuals and the withholding tax of non-residents and foreign companies. Starting from January 2025, non-resident individuals and foreign companies will face withholding tax when transferring, exchanging, or withdrawing virtual assets on exchanges. The current law is unclear on whether Korean exchanges must withhold tax before the new amendment takes effect.
Investors have welcomed the delay, believing it will help the South Korean government and industry adjust better for the smooth implementation of the new tax system.