Cryptocurrencies such as Bitcoin (BTC) accounted for the largest share of South Korea’s reported foreign assets in the country’s tax authority’s latest report.
South Korea’s National Tax Service (NTS) issued an official notice on September 20 saying that 1,432 individuals and companies had reported foreign cryptocurrency accounts this year.
The total reported amount in cryptocurrencies was 130.8 trillion Korean won (KRW), or $98 million, which represents more than 70% of the total amount of all reported overseas assets.
According to the official data, a total of 5,419 companies reported their financial accounts abroad, holding a total of KRW 186.4 trillion (US$ 140 million) in assets such as cryptocurrencies, stocks, and deposits and savings.
While cryptocurrencies were the largest assets reported abroad based on the amount of assets reported, deposits and savings accounts came out on top based on the number of reports, with 2,952 individuals and companies reporting KRW 22.9 trillion (US$17 million) to keep. Another 1,590 companies reported holding shares worth KRW 23.4 trillion (US$17.6 million).
Related: South Korea Plans to Submit Bill to Freeze North Korea’s Crypto Assets: Report
The NTS mentioned that the tax authority plans to subject those who fail to report foreign financial accounts to strict scrutiny. The authority has compiled data on cross-border information exchange, foreign exchange trading data and related notification data from authorities, the NTS noted, adding that fines will be imposed on those who violate the rules. The regulator explained:
“To respond to the risk of potential tax base erosion caused by virtual assets, tax authorities around the world, including the National Tax Service, are preparing to exchange information in accordance with the Information Exchange Reporting Regulations.”
South Korea, a major crypto-friendly country, has focused heavily on cryptocurrency tax regulations in recent years, confiscating millions of dollars in cryptocurrencies from tax evaders. In August 2023, the South Korean city of Cheongju reiterated its plans to begin confiscating cryptocurrencies from local tax evaders.
Previously, the South Korean government had reportedly postponed the introduction of a 20% tax on crypto profits until July 2023. The tax was scheduled to take effect in early 2023, but has not been delayed until 2025.
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