South Korean tribunal rules foreign crypto issuers with domestic operations liable for tax

A ruling from South Korea's Tax Tribunal has affirmed that companies established overseas for issuing cryptocurrency are subject to domestic corporate tax if their business is substantially managed from within South Korea. The tribunal disclosed that on Aug. 28 last year, it rejected an appeal filed by a Singapore-based entity, referred to as Corporation A. The appeal challenged a decision by the National Tax Service (NTS) to classify the firm as a domestic corporation and impose taxes on unreported digital asset sales. According to the case details, the NTS registered Corporation A as a domestic business in June 2023 and conducted a tax audit. The investigation concluded that the company had failed to report revenue from 28,531,385 of its issued tokens, leading to the tax assessment. In its ruling, the Tax Tribunal sided with the NTS, finding that Corporation A lacked a substantial place of management in Singapore and that its major business decisions were made in South Korea.