The South Korean Ministry of Strategy and Finance on Monday cleared that virtual asset airdrops, staking rewards and hard forked tokens would be subject to a gift tax. Will this make you think twice when you receive your next airdrop?
In response to a tax law inquiry about transfers of virtual asset airdrops by crypto exchanges, the South Korean tax authority said that any free virtual asset transfer by crypto exchanges in the form of airdrops, staking rewards and hard-forked tokens would attract a gift tax.
The gift tax will be “levied on the third party to whom the virtual asset is transferred free of charge,”The tax authority cleared that even though virtual asset gains tax would now be applicable from 2025, free virtual asset transfers would still attract a 10-50% tax under the Inheritance and Gift Tax Act.
“Whether a specific virtual asset transaction is subject to gift tax or not is a matter to be determined in consideration of the transaction situation, such as whether it is a consideration or whether actual property and profits are transferred.”postponement of the virtual asset gains tax by the authorities on multiple occasions. It becomes quite complex for them to examine all types of virtual asset transactions and form a legal basis around them. Thus, making it difficult to grasp the details of virtual asset donations, even when taxes are levied.