Capital Gains Tax in North Korea

North Korea does not have a separate capital gains tax system. Capital gains are generally treated as ordinary income and taxed under the personal income tax or corporate income tax framework.

Scope of Capital Gains Tax

Capital gains in North Korea are taxed as ordinary income for both individuals and corporations. There is no separate capital gains tax regime; gains are integrated into the regular income tax system at progressive PIT rates (0-20%) or CIT rates (25% for foreign enterprises).

Capital Gains for Individuals

Asset Disposal Gains

Gains from the sale of assets are subject to tax at progressive PIT rates (0-20%). The gain is included in the individual's annual income and taxed according to the applicable bracket.

Securities and Investments

Given the limited private investment landscape in North Korea, securities gains are rare for individuals. Where applicable, gains are treated as ordinary income.

Capital Gains for Corporations

Corporate capital gains are treated as ordinary business income and taxed at the standard CIT rate of 25% for foreign investment enterprises. This includes gains from the sale of fixed assets, investments, and business property.

Exemptions and Reliefs

• Transactions within state-controlled entities may be exempt
• Qualifying foreign investment in priority sectors may receive relief

Calculation of Gains

The capital gain is calculated as the difference between the sale price and the acquisition cost. Limited documentation requirements exist for private transactions.

Filing and Payment

Individuals declare capital gains in their annual tax return. Corporations report gains as part of their corporate tax return. Foreign investors should consult with local authorities on applicable rates.