South Korea postpones implementation of new virtual asset tax law to January 2025

The South Korean government announced that it will postpone the implementation of the new virtual asset tax law to January 2025 to address individual investor tax burdens and regulatory clarification issues. Under the new regulations, from 2025, the law will cover income tax for residents, withholding tax for non-residents, and gift tax on virtual assets. Crypto investment income is classified as "other separately taxable income" and will not affect personal tax exemptions. For cryptocurrency investors with an annual income of more than 1 million won, personal tax exemptions remain unchanged. The extension mainly affects resident personal income tax and withholding tax for non-residents and foreign companies. From January 2025, non-resident individuals and foreign companies will face withholding tax when transferring, converting or withdrawing virtual assets on exchanges. Current law is unclear whether Korean exchanges must withhold taxes before the new amendment takes effect. Investors welcomed the extension, believing that the extension will help the South Korean government and industry better adjust to the smooth implementation of the new tax system. (Coin Edition)