Where to start?

"In this law, 'crypto-assets' means the following: However, except for rights specified in Article 29-2, Paragraph 8 of the Financial Instruments and Exchange Act."

Article 14, Section 1 of the Payment and Settlement Transactions Act. The first paragraph that opens with the tax on crypto assets is this one. This is because the Income Tax Act and the Corporation Tax Act, as well as the Consumption Tax Act, do not explicitly define crypto assets, but instead cite this paragraph specifically. The way the definition is read is as follows: How does the tax law define "cryptoassets"? We are dealing with that.

There is only one entrance, but the path from there splits into two. Individuals go to the Income Tax Act, and corporations go to the Corporation Tax Act. Even if you sell the same stock on the same day at the same price, the wording of the laws is different and the calculation methods are also different. This article is a map; the details of the individual laws are left to the respective articles.

Overview

Where does the reading text differ between individuals and corporations?

The pillar for individuals is Article 35(1) of the Income Tax Act.

"Income from miscellaneous activities refers to income that does not fall under interest income, dividend income, real estate income, business income, salary income, retirement income, forest land income, transfer income, and temporary income."

This is a provision that defines income that does not fall under any of the other 9 categories. The term “crypto-asset” is not used. However, the reason why this entry point is here is because the profit from the trading of crypto-assets is unlikely to fall under any of the other 9 categories. Furthermore, Article 48-2 of the Income Tax Act states “the amount of business income or the amount of income from other sources,” and it can be inferred that the text also assumes these two concepts. For more details, see Which category of income do individual cryptoasset earnings fall under? Please see

The pillar of the corporate side is Article 61, paragraph 1 of the corporate tax law.

"When a domestic corporation transfers "short-term trading instruments (assets designated by a government decree as assets acquired for the purpose of profiting from short-term price fluctuations (excluding securities) and crypto assets (defined in Article 2, Paragraph 14 of the Financial Instruments and Exchange Act (Law No. 59 of 2011)) (hereinafter referred to as "crypto assets") (the same shall apply in this Article)."

Please note that the “and” in the brackets refers to short-term trading instruments. These are defined as assets acquired for the purpose of profiting from short-term price fluctuations, and are classified as a combination of crypto assets and other assets. Even if they are acquired for any other purpose, they are placed after the “and” in the brackets. This means that even if they are acquired with the intention of holding them for a long-term period, they are still subject to the scope of Article 61 of the Corporation Tax Act.

The locations for filing are also divided. For individuals, it is from Article 119-2 to Article 119-7 of the Income Tax Enforcement Order; for corporations, it is from Article 118-5 to Article 118-12 of the Corporation Tax Enforcement Order. The number of articles and the order of the numbers are also not consistent.You cannot read individual articles to answer for a corporation, nor the other way around.

Will I be taxed just by having it?

Among the differences, the one that has the most significant effect in monetary terms is the difference between being taxed for something you haven’t sold.

Companies have their own rules. Article 61(2) of the Corporation Tax Act sets out how the assessed value at the end of the year is to be calculated, and Article 3 follows to determine the destination of the difference that arises from that calculation. The last paragraph of Article 3.

"……For the purposes of calculating the amount of income for the fiscal year in which it belongs, the amount of profit or loss shall be included in the calculation of the amount of income."

If the fair value of the asset increases at the end of the period, the gain is recognized as income; if it decreases, the loss is recognized as expense. This gain or loss is reversed the following fiscal year, even if the asset is not sold or the transaction is not settled (Article 118-10, Paragraph 1 of the Enforcement Act on the Handling of Corporate Tax). This is known as a “washout” process.

However, not all crypto assets held by legal entities are valued at market price. Article 61, paragraph 2, item 1, limits the subject matter of the fair value standard to “market crypto assets.” The content of this is set out in Article 118, paragraph 7, item 1 of the Enforcement Order on the Tax on Legal Persons, which stipulates three requirements: What is "an active market for crypto assets"? The market crypto assets are covered; however, specific self-issued crypto assets and crypto assets with transfer restrictions are excluded from this section. The former Will there be any inclusion income tax charged on tokens issued by myself? The latter Even tokens issued by other companies can be valued at market price if there are transfer restrictions. Please see the overall flow. Are companies taxed just by having them? summarizing in

What about individuals? The provision that deals with the value of an individual’s income at the end of the year is Article 48(2) of the Income Tax Act.

"……The value of the crypto assets held on December 31 of that year, which forms the basis for that calculation, shall be the amount evaluated according to the valuation method selected by the person for that crypto asset (in the event that the method of evaluation is not selected or the method of evaluation is not evaluated according to the method selected, the amount evaluated shall be the amount evaluated according to the method specified by the decree)."

What this article stipulates is the base value upon which the amount to be included in the necessary expenses is calculated. There is no mention of including appreciation or depreciation in the total income for the year or in the necessary expenses in this article.There is no provision in the Personal Income Tax Act that corresponds to Article 61, Paragraph 3.

Where do the seven points of discussion diverge?

I will list the main points.

How are the evaluation methods and the notification different?

The third line of the table contains a pitfall. The two methods available are the average method and the moving average method; both require a tax return. The only difference is what happens if you fail to file one. Article 119(5) of the Personal Income Tax Enforcement Order sets out the rules.

The method prescribed by the ordinance specified in Article 48-bis, paragraph (1) (Calculation of the cost of transfer of crypto-assets, and methods for evaluating them), shall be the method of valuation based on the average method set forth in Article 19-bis, paragraph (1), item (i) (Method of evaluating crypto-assets).

The corporation is subject to Article 118-6, Paragraph 8 of the Enforcement Decree on the Taxation of Corporations.

The method prescribed by the decree specified in Article 61, Paragraph 1, Item 2 shall be the moving average method specified in Paragraph 1, Item 1.

If you do not submit a report, individuals use the average method, and corporations use the moving average method.The order is reversed. The deadline for filing returns is also different: for individuals, it is the deadline for filing the tax return; for corporations, it is the deadline for submitting the return form. The procedures for individuals are: The average method and moving average method — how to evaluate individual crypto assets and how to report them So, how is the acquisition price determined? How is the acquisition price of crypto assets held by individuals determined? We are dealing with that.

What happens when you sell it and lose money?

The profit or loss when a corporation sells its assets is recorded in the business year to which the contract relating to the transfer was concluded, not on the day of delivery, in accordance with Article 61, Paragraph 1 of the Corporation Tax Act. When a corporation sells crypto assets, when is the gain or loss recorded? We are dealing with that.

The treatment of losses is also different for individuals and corporations. For individuals, it is Article 69(1) of the Income Tax Act.

"When calculating the total income amount, retirement income amount, or forest income amount, losses incurred in calculating the amount of real estate income, business income, forest income, or transfer income shall be deducted from the amount of other types of income in the order prescribed by the decree."

The four losses that are listed as deductible from other income are: These losses are not included in the calculation of the amount of miscellaneous income. Article 70 of the Income Tax Act, which sets forth the carry-over deduction for net losses, also specifies the amount of net losses as the eligible amount.

The corporate side will include the transfer loss amount under Article 61, Paragraph 1, and the valuation loss under Paragraph 3 in the calculation of the income for that fiscal year. Furthermore, the carryover of corporate deficiency amounts is not included in the article cited in this article, so we will not discuss it. Credit trading of crypto assets So, I’m organizing them by individuals and corporations.

The current provisions in this article apply here. As for how individuals are taxed, a review is being discussed, so please be aware of that. Key points of the FY2026 tax system revision outline Please also see this article. The order in which these systems were created is as follows: The crypto asset tax system was created this way. summarizing in

Is the consumption tax different for individuals and corporations?

It makes no difference. Only here does the road converge. The Consumption Tax Act Table II, No. 2 lists the means of payment as one of the transferations that are exempt from tax, and Article 9, Paragraph 4 of the Consumption Tax Enforcement Decree describes the contents of that list.

"Any means of payment specified in the Second Schedule to the Act, as defined by a decree, shall be electronic payment means, cryptocurrencies as defined in Article 14 of the Law on Payment and Capital Movements, and special withdrawal rights as defined in Article 15 of the International Monetary Fund Agreement."

The reason for this exclusion is Article 2.14 of the Payment and Settlement Act. For both individuals and corporations, the transfer of crypto assets does not incur consumption tax. For more details, please see here. Selling crypto assets does not incur consumption tax Please see

Points that require care in practice

• This is the case where private individuals handle crypto assets, but then establish a corporation to transfer them. Since the applicable regulations are completely changed, the end-of-year valuations and filings will also need to be reviewed again.
• This is a situation where a corporation has acquired crypto assets that it intends to hold for a long time. Article 61(1) of the Corporation Tax Act lists crypto assets as “and,” and does not specify whether they are intended for short-term trading or not.
• This is a situation where both individuals and legal entities hold crypto assets. Even if the same securities are traded, filing separately is required; the same goes for failing to file.
• When a corporation's year-end approaches. Even without a sale, crypto assets classified as market crypto assets generate valuation gains or losses at year-end market value.
• When an individual has unrealized losses at year-end. Article 48-2 of the Income Tax Act contains no provision deducting unrealized losses from the year's income, and miscellaneous income losses are not among the categories listed in Article 69(1).
• When tokens you hold are subject to transfer restrictions. For corporations this relates to the exclusions in Article 61(2)(i) of the Corporation Tax Act, but the provisions for individuals contain no corresponding category.
• When it is uncertain whether an asset qualifies as a crypto asset at all. This entire map assumes the definition in Article 2(14) of the Payment Services Act is met, so that must be checked first.

Legal basis

• Payment Services Act, Article 2(14) (Definitions) / Quoted wording: “In this Act, ‘crypto assets’ means the following, excluding those representing rights prescribed in Article 29-2(1)(viii) of the Financial Instruments and Exchange Act.”
• Income Tax Act, Article 35(1) (Miscellaneous Income) / Quoted wording: “Miscellaneous income means income that does not fall into any of the categories of interest income, dividend income, real estate income, business income, employment income, retirement income, timber income, capital gains, or occasional income.”
• Income Tax Act, Article 48-2(1) (Calculation of Crypto Asset Transfer Costs and Methods of Valuation) / Quoted wording: “The value of crypto assets held on December 31 of that year forming the basis of the calculation shall be the amount valued using the valuation method selected by that person for crypto assets (if no valuation method was selected, or valuation was not performed using the selected method, the amount valued using the method prescribed by Cabinet Order).”
• Income Tax Act, Article 69(1) (Offsetting Profits and Losses) / Quoted wording: “When calculating total income, retirement income, or timber income, if a loss arises in calculating real estate income, business income, timber income, or capital gains, it shall be deducted from other categories of income in the order prescribed by Cabinet Order.”
• Income Tax Act, Article 70 (Carryforward Deduction of Net Losses) / Limits carryforward deductions to net losses. This article does not examine the requirements in detail.
• Income Tax Act, Article 37(1) (Necessary Expenses) / The provision referenced by Article 48-2 when calculating amounts included in necessary expenses.
• Order for Enforcement of the Income Tax Act, Article 119-2(1) (Methods of Valuation of Crypto Assets) / Lists the total average and moving average methods as available valuation methods.
• Order for Enforcement of the Income Tax Act, Article 119-3 (Selection of a Crypto Asset Valuation Method) / Quoted wording: “A valuation method for crypto assets must be selected for each type.”
• Order for Enforcement of the Income Tax Act, Article 119-4 (Procedure for Changing a Crypto Asset Valuation Method) / Requires approval from the tax office director to change the valuation method.
• Order for Enforcement of the Income Tax Act, Article 119-5(1) (Statutory Crypto Asset Valuation Method) / Quoted wording: “The method prescribed by Cabinet Order in Article 48-2(1) of the Act (Calculation of Crypto Asset Transfer Costs and Methods of Valuation) shall be valuation at acquisition cost calculated using the total average method specified in Article 119-2(1)(i) (Methods of Valuation of Crypto Assets).”
• Order for Enforcement of the Income Tax Act, Article 119-6 (Acquisition Cost of Crypto Assets) / Specifies acquisition cost separately for purchased crypto assets, self-issued crypto assets, other crypto assets, and those acquired by gift, inheritance, or bequest.
• Order for Enforcement of the Income Tax Act, Article 119-7 (Acquisition Cost of Crypto Assets in Margin Transactions) / Specifies the amount included in necessary expenses when crypto margin transactions are settled.
• Corporation Tax Act, Article 61(1) (Gains and Losses on Transfers and Market Valuation of Short-Term Trading Commodities, etc.) / Quoted wording: “Where a domestic corporation transfers short-term trading commodities and similar assets (meaning assets prescribed by Cabinet Order as acquired to profit from short-term price fluctuations (excluding securities), and crypto assets under Article 2(14) (Definitions) of the Payment Services Act (Act No. 59 of 2009), hereinafter referred to in this article as ‘crypto assets’; the same applies throughout this article).”
• Corporation Tax Act, Article 61(2) (Gains and Losses on Transfers and Market Valuation of Short-Term Trading Commodities, etc.) / Specifies year-end valuation methods by asset category. For crypto assets, market valuation applies only to market crypto assets, excluding specified transfer-restricted crypto assets and specified self-issued crypto assets.
• Corporation Tax Act, Article 61(3) (Gains and Losses on Transfers and Market Valuation of Short-Term Trading Commodities, etc.) / Quoted wording: “shall be included in gross income or deductible expenses in calculating income for the fiscal year containing that year-end.”
• Corporation Tax Act, Article 61(7) (Gains and Losses on Transfers and Market Valuation of Short-Term Trading Commodities, etc.) / Quoted wording: “deeming the crypto asset margin transaction to have been settled at that time.”
• Order for Enforcement of the Corporation Tax Act, Article 118-5 (Acquisition Cost of Short-Term Trading Commodities, etc.) / Specifies acquisition cost separately for purchased assets, self-issued assets, and other assets.
• Order for Enforcement of the Corporation Tax Act, Article 118-6(8) (Methods for Calculating Book Value per Unit of Short-Term Trading Commodities, etc., and Selection Procedures) / Quoted wording: “The method prescribed by Cabinet Order in Article 61(1)(ii) of the Act shall be the moving average method specified in paragraph (1)(i).”
• Order for Enforcement of the Corporation Tax Act, Article 118-7(1) (Scope of Market Crypto Assets, etc.) / Specifies the requirements for crypto assets prescribed by Cabinet Order as having an active market.
• Order for Enforcement of the Corporation Tax Act, Article 118-8 (Market Valuation of Short-Term Trading Commodities, etc.) / Specifies how to calculate values under the market value method.
• Order for Enforcement of the Corporation Tax Act, Article 118-10(1) (Treatment in the Following Fiscal Year of Valuation Gains or Losses on Short-Term Trading Commodities, etc.) / Quoted wording: “shall be included in deductible expenses or gross income in calculating income for the following fiscal year.”
• Order for Enforcement of the Corporation Tax Act, Article 118-12(1) (Treatment in the Following Fiscal Year of Amounts Equivalent to Gains or Losses on Unsettled Crypto Asset Margin Transactions) / Requires reversal in the following fiscal year of amounts included in gross income or deductible expenses for unsettled crypto margin transactions.
• Consumption Tax Act, Appended Table 2, Item (ii) / Quoted wording: “other similar instruments prescribed by Cabinet Order.”
• Order for Enforcement of the Consumption Tax Act, Article 9(4) / Quoted wording: “The instruments prescribed by Cabinet Order as similar to means of payment under item (ii) of Appended Table 2 of the Act shall be electronic payment instruments, crypto assets under Article 2(14) of the Payment Services Act, and special drawing rights under Article XV of the Articles of Agreement of the International Monetary Fund.”