South Korea Crypto Tax: 20% Gain Tax on Profits Over 50 Million KRW (2027 Start)

Ben Bevan 4 December 2025 14 Comments

South Korea Crypto Tax Calculator

Calculate your tax liability under South Korea's new crypto tax rules (effective January 2027)

The 20% capital gains tax applies to profits exceeding 50 million KRW ($35,900). Income from staking/mining is taxed at up to 49.5%.

Annual crypto gains (KRW)

Tax type

Capital gains (trading/selling) Taxed at 20% on amounts over 50 million KRW

Other income (staking/mining/earnings) Taxed at your personal income rate (up to 49.5% with local taxes)

Enter your gains and tax type to see your tax liability.

By January 2027, if you make money trading or selling cryptocurrency in South Korea, you’ll owe taxes-unless your total annual gains are under 50 million Korean Won (about $35,900). That’s the new rule, and it’s not a rumor. After years of delays, the government finally locked in the timeline. The tax isn’t as scary as it sounds for most people, but it’s complex enough to trip up even experienced traders.

What’s Actually Taxed?

Not all crypto activity is treated the same. South Korea splits crypto income into two buckets: capital gains and other income. If you buy Bitcoin at $30,000 and sell it later at $50,000, that $20,000 profit is a capital gain. That’s taxed at 20%-but only if your total gains for the year exceed 50 million KRW. Below that? No tax. That exemption protects everyday users who dabble in crypto, not big traders.

But if you earn crypto from mining, staking, airdrops, or getting paid in Bitcoin for freelance work? That’s classified as "other income." And that’s where things get steep. This income is added to your total yearly earnings and taxed at your personal income tax rate, which can go as high as 49.5% when you include local taxes. So if you’re earning $100,000 in crypto staking rewards on top of your regular salary, you could be paying nearly half of it in taxes.

Why the 20% Rate? It’s Not What You Think

The 20% capital gains rate sounds low compared to the 49.5% income tax rate. But here’s the catch: it’s only applied to the portion of your gains above 50 million KRW. So if you made 60 million KRW in crypto profits this year, only 10 million KRW gets taxed at 20%. The rest is tax-free. That’s a massive buffer. In countries like Germany, you avoid tax only if you hold for over a year. In South Korea, you avoid tax if you don’t make more than $35,900 in profit-no matter how long you held.

When you add local taxes, the real rate becomes 22%. That’s still lower than the top marginal rate for stocks or real estate in Korea, which can hit 45%. So crypto isn’t being punished-it’s being treated like a middle-tier asset. The government isn’t trying to scare people away. It’s trying to catch the big players who’ve been flying under the radar.

What’s Not Taxed?

You won’t pay VAT on crypto purchases. Buying Bitcoin with won? No tax. Swapping Ethereum for Solana? That’s a taxable event because you’re selling one asset to buy another. But if you just hold, or transfer crypto between your own wallets? No tax. You also don’t pay tax on gifts-unless the recipient sells it later and exceeds the 50 million KRW threshold.

Foreigners living in Korea face different rules. If you’re a non-resident, you pay either 11% on the sale price or 22% on net gain, depending on the situation. That’s simpler than the domestic system, but still not friendly for short-term traders.

Wearable crypto compliance tracker wristband with LED indicators for tax status.

How Do You Track Everything?

This is where most people get stuck. Every trade, every staking reward, every NFT sale-you need to track it. The National Tax Service expects you to know the exact Korean Won value of each transaction at the time it happened. That means saving screenshots of exchange prices, recording timestamps, and keeping a log of every wallet address you used.

For someone who trades once a month, this might take an hour a year. For someone who’s active in DeFi, staking across five platforms, and flipping NFTs? That’s 15 to 20 hours just to get organized. Most people use crypto tax software like Koinly or CoinTracker, which auto-import data from exchanges. But even those tools struggle with DeFi protocols that don’t have clean APIs. You might end up manually entering hundreds of transactions.

The government doesn’t offer official tools. No app. No dashboard. Just PDF guides written in Korean that assume you already know how accounting works. That’s a problem. Many traders don’t know how to calculate cost basis for crypto-to-crypto trades. The IRS in the U.S. has clear rules. Korea does not.

Why the Delay Until 2027?

The original plan was 2022. Then 2025. Then December 2024, lawmakers pushed it to January 2027. Why? Because the industry pushed back hard. Exchanges warned that forcing tax compliance too soon would drive users offshore. Retail investors feared being fined for simple mistakes. Tax professionals said the system wasn’t ready to handle DeFi or cross-border transactions.

The government listened. The delay wasn’t a win for tax evaders-it was a win for practicality. It gave the National Tax Service time to build better guidance, and it gave traders time to get their records in order. Still, many are skeptical. Korea has delayed crypto taxes before. Will they stick to 2027? Most experts say yes. The political compromise was too clear. The OECD’s new global crypto reporting rules are coming in 2027 too. Korea doesn’t want to be left behind.

Who Gets Hit the Hardest?

Not the guy who bought $500 worth of Dogecoin and sold it for $800. He’s fine. He’s under the threshold.

The ones who feel the pinch are:

Stakers earning $1,000 a month in rewards-those add up fast and get taxed as income.
DeFi farmers who swap tokens daily-each swap is a taxable event.
Freelancers paid in crypto-every payment is income, and it’s added to your salary.
People who bought crypto before 2020 and sold big in 2025-they’ll owe a lot, all at once.

There’s no amnesty for past trades. The tax applies retroactively to gains made since 2022. If you made 100 million KRW in profit in 2023 and didn’t report it, you’ll owe back taxes plus penalties when you file in 2027.

Modular desktop organizer with labeled compartments for crypto tax records and tokens.

What Happens If You Don’t File?

The blockchain is public. Every transaction leaves a trace. The Korean tax agency can-and will-cross-reference exchange data with bank records. If you earned crypto from Binance or Upbit and never reported it, they’ll find it. Penalties start at 20% of the unpaid tax and can go up to 40% if they think you’re hiding. In extreme cases, criminal charges are possible.

There’s no walking away. Even if you move abroad, if you were a Korean tax resident when you made the gains, you still owe. The government is working with international tax authorities to share data. This isn’t a loophole you can outsmart.

What Should You Do Now?

You have until January 2027 to get ready. Here’s what to do:

Export all your transaction history from every exchange and wallet you’ve used since 2022.
Use a crypto tax tool to calculate your gains and losses. Pick one that supports Korean Won.
Separate your capital gains from your income. Track staking, airdrops, and payments separately.
If you’re under 50 million KRW in gains, you’re safe. Keep the records anyway.
If you’re over it, start setting aside 22% of your profits for taxes.
Don’t wait until December 2026. Start now. The first wave of filings will be chaotic.

There’s no magic fix. No way to avoid the tax if you’re above the threshold. But if you plan ahead, you won’t get blindsided. The goal isn’t to evade-it’s to comply without panic.

Is This Fair?

Compared to other countries, Korea’s system is actually balanced. The high exemption threshold shields small investors. The 20% rate on gains is reasonable. The real issue is the income tax on staking and DeFi-those rates are brutal. But that’s not unique to Korea. The U.S. taxes staking rewards as ordinary income too. The difference? Korea doesn’t let you offset losses against gains the same way. You can’t use a $10,000 loss on one coin to reduce your $15,000 gain on another. Each trade is treated separately.

It’s not perfect. But it’s clearer than it was two years ago. And for the first time, there’s a real path forward for everyone-from the casual buyer to the professional trader.

Do I pay tax if I only trade crypto under 50 million KRW per year?

No. If your total capital gains from selling or trading crypto in a single year are below 50 million KRW (about $35,900), you owe no capital gains tax. This applies regardless of how many trades you make. Only profits above that threshold are taxed at 20% (22% with local taxes). But remember: income from staking, mining, or being paid in crypto is taxed separately and has no exemption.

Are crypto-to-crypto trades taxable in South Korea?

Yes. Swapping Bitcoin for Ethereum, or Solana for USDT, is treated as a sale. You must calculate the profit or loss based on the Korean Won value at the time of the trade. Even if you didn’t convert to fiat, the IRS-style rule applies: every swap is a taxable event. This makes DeFi trading especially complex, since you might make dozens of swaps in a month.

What if I earned crypto from a foreign exchange like Binance?

You still owe tax. South Korea taxes residents on worldwide income. Whether you earned crypto from Binance, Coinbase, or a decentralized protocol, if you’re a Korean tax resident, you must report it. The National Tax Service confirmed in July 2025 that crypto received from foreign corporations must be included in your annual income tax return. Ignoring foreign platforms won’t help you avoid the tax.

Is there a holding period exemption like in Germany?

No. Unlike Germany, where you pay no tax if you hold crypto for over a year, South Korea has no holding period exemption. Whether you held Bitcoin for one day or five years, if you sell it for a profit above 50 million KRW, you pay the same 20% tax. The tax is based on profit, not time.

Can I use losses to reduce my crypto tax bill?

Not really. South Korea does not allow you to offset crypto losses against crypto gains across different trades. Each transaction is evaluated individually. If you lost money on one coin and made money on another, you can’t net them out. You pay tax on the gains, even if your overall portfolio lost value. This is one of the biggest pain points for active traders.

Do I need to report NFT sales?

Yes. Selling an NFT for profit counts as a capital gain. If your total crypto gains (including NFTs) exceed 50 million KRW in a year, the profit is taxed at 20%. Buying an NFT with crypto is also a taxable event-you’re selling crypto to acquire it. The tax rules for NFTs are the same as for other cryptocurrencies.

What if I don’t know the original cost of my crypto?

You’re required to use a reasonable method to determine cost basis. The most common accepted method is FIFO (first in, first out). If you bought Bitcoin in 2020 at 1 million KRW and sold some in 2025, you assume the earliest purchase price applies. If you can’t prove cost basis, the tax office may assume it’s zero-which means you owe tax on the full sale amount. Keep records.

Will the tax rate change after 2027?

The 20% capital gains rate and 50 million KRW threshold are set for now, but they’re not permanent. The government can adjust them in future budgets. If crypto trading grows significantly, the threshold might be lowered. If revenue falls short, the rate might rise. The 2027 implementation is the start, not the end, of Korea’s crypto tax policy.