South Korea is scheduled to begin taxing qualifying virtual asset transfer and lending income from Jan. 1, 2027 at a combined 22%, applying a 20% national income tax plus a 2% local income tax on annual gains above a ₩2.5 million deduction, after repeated postponements since the legal basis was set in 2020. Chainalysis’s Crypto Tax Report, released Aug. 31, estimated the country’s potentially taxable on-chain activity at about $10.9 billion in 2025, ranking 11th among analyzed countries and comprising $5.6 billion in payments, $3.2 billion in trading gains and $2 billion in income across Bitcoin, Ethereum, Solana, Tron, BNB Smart Chain and Base data—equal to roughly 144.05% of the government’s $7.5 billion fiscal deficit that year, though the firm stressed the comparison is not a revenue forecast. Domestic exchanges must supply transaction data, while overseas platforms and self-custodied assets create visibility gaps; the National Tax Service told People Power Party lawmaker Kim Sang-hoon’s office it will introduce commercial tracing software already used by prosecutors, police and the U.S. IRS to analyze movements between private wallets, while acknowledging that identifying every unreported self-custody transaction remains difficult. Crypto income from private wallets and foreign exchanges remains taxable, and Seoul plans to draw on the OECD Crypto-Asset Reporting Framework for overseas activity, with information exchanged in 2028 expected to cover 2027 transactions and the first taxpayer filings for 2027 income due in May 2028. Authorities have also prepared tax-source and integrated analysis systems, worked with Upbit operator Dunamu, Bithumb, Coinone, Korbit and Gopax on implementation guidance, tightened risk-based controls on overseas and personal-wallet transfers of at least ₩10 million, and floated a court-supervised framework for seizing self-custodied crypto, even as opposition lawmakers still seek repeal or a delay to 2030.