They even track personal wallets? National Tax Service builds virtual asset monitoring system

Summary

Tax expert Lee Jeong-won discusses South Korea's preparations for virtual asset taxation starting in 2027, including the National Tax Service's new wallet monitoring system. He covers foreign account reporting requirements, tax treatment of staking, airdrops, and hard forks, and suggests the final crypto tax delay may depend on market conditions in late 2025. Practical compliance advice and potential future regulatory tightening are also outlined.

• Foreign virtual asset accounts exceeding 500M KRW must be reported by end of June; non-compliance carries a 10% penalty.
• The National Tax Service is building a system to track virtual asset wallets, even P2P, with a ~30B KRW budget.
• Staking and lending rewards will likely be taxed as miscellaneous income at 22% upon receipt; airdrops and hard forks face zero cost basis, making sale proceeds fully taxable.
• The government's final decision on the 2027 crypto tax may hinge on crypto market strength around October-November 2025.
• There is currently no Korean tax-advantaged account for crypto, and none is expected given the government's stance.
• Taxpayers are advised to keep screenshots and records of acquisition dates and prices to protect themselves during future audits.