Ruling to take place in 2022
According to a report on Donga, miners whose profits exceed 2.5 million won a year will be taxed at 20% of their profits.
The cost of electricity required for the extraction work is considered as necessary cost for the work and will be deducted from the total revenue, but its consumption must be described with absolute clarity.
A finance ministry official said:
“It will have to be proven how many cryptocurrencies were mined by setting up a computer, in a specific place, and the required electricity consumption and billing required.”
Transactions fees from total income will also be taken into account in the tax system. In addition, digital asset miners in the country will have to file their tax returns each year in May, detailing the value of the coins mined in the last financial year.
These tax obligations of the miners will come into force from January next year.
As we can see, the South Korean government is strengthening its laws on controlling all cryptocurrency-related activities.
South Korean tax authorities recently seized $22 million worth of cryptocurrencies, more than 1.500 in violation of tax law. The cryptocurrencies were confiscated directly from the offenders’ accounts at cryptocurrency exchanges.