In India, cryptocurrencies are taxed as Virtual Digital Assets (VDAs). The Finance Act, 2022, introduced a framework to tax VDAs, including cryptocurrencies, at a flat rate of 30% on income from their transfer, along with applicable surcharge and cess. Additionally, a 1% Tax Deducted at Source (TDS) is applied to transactions exceeding ₹50,000 in a financial year.
The Budget 2025 expanded the definition of VDAs to include crypto-assets using blockchain technology. Losses from VDAs cannot be set off against other income. If you are unsure about your crypto tax situation, we recommend you to talk to an ODFC tax advisor in your location, we are available in 750+ districts across the country.
ODFC Digital Helpdesk
WhatsApp 🪀 8779696580
Email 📨 help@odfcdigital.com
1️⃣ - Profit Tax:
A flat 30% tax is applied to profits from trading, selling, or spending cryptocurrencies.
2️⃣ - Tax Deducted at Source (TDS):
A 1% TDS is applicable on crypto transactions exceeding INR 50,000 (or INR 10,000 in certain cases) in a financial year.
3️⃣ - Reporting:
Crypto Profits must be reported in the Schedule VDA of the Income Tax Return (ITR).
4️⃣ - No Distinction:
The tax rate applies uniformly, regardless of whether gains are short-term or long-term.
When do you have to pay crypto taxes?
When trading or investing in crypto, common taxable events include:
1️⃣ - Selling crypto for cash –
If you sell Bitcoin or other crypto for cash, you might owe taxes on any profit you make.
2️⃣ - Trading one crypto for another –
Swapping one crypto for another is usually a taxable event (e.g., trading ETH for SOL).
3️⃣ - Buying things with crypto –
Paying for goods or services with crypto is like selling it, so you might owe taxes.
4️⃣ - Getting paid in crypto –
If you mine, stake, or get paid in crypto, it’s typically taxed as income.
When you don’t have to pay taxes on crypto?
1️⃣ - Buying and holding crypto –
If you buy crypto and don’t sell it, there is often no tax involved.
2️⃣ - Transferring between your wallets –
Moving crypto between personal wallets is generally tax-free.
🎯 ODFC Helpdesk for Crypto & Forex Trading
The ODFC Helpdesk for Crypto & Forex Trading has been focused on assisting users, especially victims of cybercrimes and FEMA violators facing account freeze etc. Our team including the Reserve Bank of India (RBI) Compliance Consultants work in association with Crypto & Forex platforms and banks.
ODFC Digital Helpdesk
WhatsApp 🪀 8779696580
Email 📨 help@odfcdigital.com
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