South Korea Unveils Tracing Tools to Enforce 2027 Crypto Tax

South Korea's National Tax Service (NTS) plans to use commercial tracing software to track digital asset movements between private wallets, as part of its efforts to enforce a 2027 crypto tax.

The NTS acknowledged that identifying all unreported private wallet transactions remains difficult because taxpayers directly control the assets. The agency will rely partly on the OECD's Crypto-Asset Reporting Framework (CARF) to obtain transaction information from participating jurisdictions, including the UAE, which has its own CARF rules applying from 2027.

The tax agency is preparing to tax income generated through private wallets and overseas exchanges, with qualifying gains subject to a combined 22% tax. Taxpayers will not file returns for 2027 income immediately when the rules take effect; the first filing period is scheduled for May 2028, when investors will report qualifying income generated during the previous calendar year.