South Korea has finally dealt with the taxation of cryptocurrencies received from foreign sources. After a request received back in the spring, the Tax Service (NTS) officially stated: if you are a resident of the country and receive digital assets from a foreign company as a salary or bonuses, this must be indicated on the tax return.

The crux of the question was: should South Korean citizens who work under contracts with foreign companies and receive cryptocurrency declare it as income from abroad? NTS's response was clear and reasonable.

In July, it was confirmed that if taxes are not withheld automatically, taxpayers are required to file a declaration themselves.
The basis for this decision was the articles of the Income Tax Act, namely the article on withholding taxes at the source of payment, and the article on the mandatory declaration of all income.

However, the new clarification raises questions that have not yet been clearly answered. The main one is how to evaluate cryptocurrency income for tax purposes? Which exchange rate should I use: at the time of receiving the asset, converting it into regular money, or filing a declaration? The lack of clarity on this issue creates uncertainty for taxpayers. It is expected that NTS will provide additional clarifications on procedural issues soon, including the procedure for assessing and confirming income.

In the meantime, residents who receive cryptocurrencies from foreign companies should prepare to include these amounts in tax calculations, taking into account the increased requirements of the regulator.