South Korea Delays Crypto Tax to 2029, Waits on the US

• South Korea plans to push its crypto gains tax back to January 2029.
• The delay still needs an amendment from the National Assembly.
• The new date follows the year the US joins global crypto tax data sharing.
• Investors would be able to carry losses forward for three years.

South Korea’s government will ask lawmakers to postpone the 22% tax on cryptocurrency gains by two more years, moving the start date from January 1, 2027, to January 1, 2029. Finance Minister Lee Hyoung-il announced the plan in Seoul on November 5, a day after the ruling Democratic Party formally requested the delay. If parliament approves it, this will be the fourth postponement since the National Assembly legislated the tax in 2020. Current law still sets a 2027 start, so only an amendment passed before January can stop it.

Along with the new date, the ministry wants a three-year loss carryforward and a public-private working group that would rewrite the reporting rules alongside the Digital Asset Act, the broader market law parliament is still drafting. Officials said the ministry still intends to collect the tax once those rules are in place.

Seoul waits for US data in 2029

The government’s main technical argument rests on the OECD’s Crypto-Asset Reporting Framework (CARF), a standard under which tax authorities automatically swap records of each other’s residents’ crypto transactions. South Korea is in the first group set to begin exchanges in 2027. The United States, home to several offshore platforms that Korean traders use heavily, joins only in 2029.

Source: OECD CARF implementation timetable

Without US data, Upbit, Bithumb and other domestic exchanges would report every customer sale to the National Tax Service from day one, while gains booked on a US venue would remain much harder to trace. Officials argue this would punish the platforms that comply and push active traders offshore. Residents would still owe tax on their foreign gains, so the concern is uneven enforcement and no one would be exempt.

Upbit can’t see what your Bitcoin cost

When a trader buys Bitcoin on a foreign platform and moves it to Upbit before selling, the Korean exchange sees the sale price but has no reliable record of the purchase price, and without that figure there is no taxable profit to calculate. Exchanges say that building reporting systems before the transfer rules are settled would mean paying to rebuild them later.

A 2029 loss could cancel a 2030 gain

Under current law, a crypto loss can only offset gains from the same tax year. The proposal stretches that window to three years, so a loss realized in 2029 could reduce taxable gains through 2032, although losses from before the regime starts would not qualify. Under the old design, an investor who lost ₩100 million (about $74,800) in 2029 and earned it back in 2030 would owe tax on the 2030 profit despite finishing both years flat.

The rest of the formula stays the same: a 20% national rate plus 2 percentage points of local tax, applied to net annual gains above a ₩2.5 million (about $1,870) deduction. A trader with ₩20 million ($15,000) in realized gains would pay 22% on ₩17.5 million, or roughly ₩3.85 million ($2,880).

43.7% of traders are in their 20s and 30s

That share comes from Financial Intelligence Unit data from October on domestic exchange users. A Korea Gallup survey taken October 20-22 put Democratic Party support at 24% among respondents aged 18-29 and 22% among those in their 30s, its weakest result in any age group. Chosunbiz reported that worries about younger voters shaped the party’s internal debate on the tax. As recently as September, Lee argued the tax would have limited impact because the deduction would leave most small investors owing little or nothing. Nothing proves that elections drove the reversal, but the government changed course within a day of the party’s request.

Choi wants a deduction 20 times larger

On October 27, People Power Party lawmaker Choi Eun-seok filed a competing amendment.

Current law: 2027 start, ₩2.5M deduction, no carryforward

Choi argues that crypto investors are treated unfairly compared with retail holders of listed Korean stocks, whose gains have generally gone untaxed since parliament scrapped the Financial Investment Income Tax in December 2024. The government has not endorsed the higher deduction.

Five checkpoints before the first tax bill

Offshore accounts lose cover in 2029

Retail traders would get two more years without a gains tax, and the carryforward would soften the regime for anyone who takes heavy losses in a downturn. Upbit and Bithumb gain time to build reporting tools once cost-basis rules exist. For traders who rely on US-based accounts, the date that matters is 2029 itself, when records on Korean clients start flowing to the National Tax Service under CARF. So far, nothing shows that the delay will lift volumes or prices on Korean exchanges.

The government’s text is not the only delay on the table. Democratic Party lawmaker Park Min-kyu filed a bill on October 16 that would tie the start of the tax to the second year after South Korea’s first CARF exchange instead of a fixed calendar date. That formula also points to 2029, but it would shift automatically if the OECD timetable slipped. Whichever version wins, lawmakers have to pass it before the regular session closes in December, because otherwise the 2027 start date in current law takes effect on its own.