South Korean tax authorities are unstoppable in keeping the eyes of cryptocurrency holders and holding them accountable for paying taxes. The National Revenue Service (NTS) has issued a warning to cryptocurrency traders, requiring them to even declare the proceeds of tokens held in foreign exchange.
There is no detailed information on how the agency supervises the process
According to MBC, the agency warned that Koreans who are using overseas exchanges are also responsible for reporting all the profits they make. In this way, cryptocurrency holders should pay corresponding taxes and fees to them from 2022.
That year was where the government sought to deploy new tax laws on cryptocurrencies. As Bitcoin.com’s news station recently reported, the South Korean central government is expected to introduce 20% of the crypto trading profits of domestic crypto exchanges only when revenue exceeds the threshold of $2,300.
NTS is concerned that crypto traders use foreign crypto exchanges to bypass their tax obligations in South Korea.
Nevertheless, it did not provide detailed information on how it will supervise the procedures for making people comply with tax laws for reporting profits from foreign cryptocurrency exchanges.
The new legal framework requires domestic cryptocurrency exchanges to submit trader data to financial regulators and tax authorities. However, there is no legal way to force foreign cryptocurrency exchanges to do so.
NTS clarified that the same tax rules apply to transactions conducted using these cryptocurrency exchanges, without in-depth details.
If the value of the trader’s holdings is $442K or more, tax should be paid to him
In addition, the tax authority reminds those holding 500 million won (442,700 US dollars) or more of assets, including cryptocurrency on foreign financial institutions (such as banks or legal trading platforms), should report in the filing.
Earlier this week, Bitcoin.com News also reported that NTS had identified 2,416 people who reportedly hid their assets in cryptocurrencies to avoid taxation.
The agency stated that evaders use Bitcoin (BTC), Ethereum (ETH), Ripple (XRP) and other cryptocurrencies to avoid censorship by the authorities.
What do you think of the warning issued by the State Administration of Taxation? Let us know in the comments section below.
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