South Korea’s National Tax Service (NTS) has established a dedicated Digital Assets Management Division in preparation for the introduction of digital asset taxation, set to begin in January
South Korea’s National Tax Service (NTS) has established a dedicated Digital Assets Management Division in preparation for the introduction of digital asset taxation, set to begin in January 2027.
The new Digital Assets Management Division is tasked with overseeing virtual asset taxation, compliance monitoring, tax administration, and the broader management of digital assets within the country. The NTS has appointed Lee Soon-yong to head the unit and has organized three specialized teams to support its operations.
This division will assume responsibility for crypto-related taxation matters previously managed by the Income Tax Division. The NTS aims to complete all necessary tax notification processes by the end of this year to ensure a smooth transition and effective implementation of the new regulations.
Under the current framework, profits from the transfer or lending of digital assets will be classified as “other income” starting January 1, 2027. Income surpassing 2.5 million won will incur a combined tax rate of 22%, which includes local income tax.
These efforts reflect the agency’s commitment to providing clear guidance and administrative support ahead of enforcement.
The formation of the Digital Assets Management Division comes as the South Korean government pursues the passage of the Digital Asset Framework Act, expected in the latter half of the year. Lawmakers from the Democratic Party support advancing both the tax policies and broader digital asset legislation in tandem.
However, the opposition People Power Party continues to challenge the crypto taxation plan. The party maintains that such taxation creates disparities between digital asset and stock investments, advocating for a more balanced approach.
South Korea’s dedicated move aligns with growing international practices, where tax authorities are establishing specialized teams to address the complexities of digital asset regulation and enforcement.
For example, the United States’ Internal Revenue Service has expanded its cryptocurrency compliance teams as reporting requirements become more stringent, while the United Kingdom’s HM Revenue & Customs has created specialist groups focused on crypto investigations and tax compliance.
By setting up a Digital Assets Management Division ahead of the 2027 enforcement date, the NTS aims to integrate administrative preparations and anticipate potential compliance challenges. The agency seeks to ensure that its reporting and guidance systems will be robust and ready by the time the new taxation rules take effect.
CountryDedicated Crypto Tax UnitStart of Crypto Tax ImplementationSouth KoreaDigital Assets Management DivisionJanuary 2027United StatesCryptocurrency Compliance Teams (IRS)Ongoing (varies by update)United KingdomSpecialist Crypto Groups (HMRC)Ongoing (varies by update)In parallel, the Bank of Korea renewed calls for legislative action concerning won-backed stablecoins. Governor Shin Hyun-song urged lawmakers to accelerate the establishment of a legal framework for these digital assets, emphasizing the need for banks to lead issuance efforts.
Mini dictionary: Bank of Korea, South Korea’s central bank responsible for monetary policy and financial stability, plays a key role in overseeing national payment systems and is actively involved in discussions around the regulation and potential issuance of digital assets such as stablecoins.
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