Crypto taxation in India underwent a fundamental shift with the introduction of Section 115BBH by the Finance Act 2022 — bringing every transfer of a Virtual Digital Asset (VDA) under a flat 30% tax rate, plus surcharge and 4% cess. From Bitcoin and Ethereum to NFTs, governance tokens, stablecoins, DeFi yields, and play-to-earn rewards — anything notified as a VDA under Section 2(47A) is now subject to a uniform tax framework that disallows any deduction except the cost of acquisition, prohibits set-off of losses against other income, and denies carry-forward of crypto losses to future years. Layered on top is Section 194S — a 1% Tax Deducted at Source (TDS) on the sale consideration of every crypto transaction, deducted by the buyer or the Indian exchange, that creates a permanent transactional trail in the taxpayer's Form 26AS and Annual Information Statement (AIS).
For Indian crypto investors, traders, miners, and businesses receiving payment in crypto, compliance is no longer optional — the Income Tax Department now receives transaction-level data from Indian crypto exchanges (CoinDCX, WazirX, ZebPay, Bitbns, Mudrex), the Financial Intelligence Unit (FIU-IND) registers and monitors Virtual Asset Service Providers (VASPs) under PMLA 2002, and AIS pre-fills crypto transactions directly into the ITR for matching with Schedule VDA. Mismatches trigger Section 143(1) intimations, defective return notices under Section 139(9), and in egregious cases, scrutiny under Section 143(2) or reassessment under Section 148. Our crypto consulting services help investors, full-time traders, miners, NFT creators, Web3 founders, and DAOs navigate this evolving framework — from accurate VDA tax computation, Schedule VDA preparation, and 1% TDS reconciliation to ITR filing, P2P transaction reporting, foreign exchange disclosure under Schedule FA, and PMLA / FEMA compliance for high-value crypto holdings.
Bought Bitcoin, Ethereum, or altcoins on Indian exchanges and held / sold during the year — Schedule VDA filing, 30% flat tax computation, 1% TDS credit reconciliation.
Day trading, futures, perpetuals, swing trading on Indian or foreign exchanges — high transaction volumes, audit threshold review, and trade-by-trade Schedule VDA preparation.
Minted, sold, or traded NFTs on OpenSea, Rarible, or Indian platforms — VDA classification, primary sale (creator income) vs secondary trade (capital transfer), royalty taxation.
Mined coins, staking rewards, liquidity pool yield, airdrops — taxation of acquisition (other income / business) and subsequent transfer (Sec 115BBH 30%).
Web3 startup receiving payment in crypto, DAO treasury management, token launch / ICO advisory — entity-level taxation, GST on services, FEMA inbound compliance.
Transactions on P2P platforms, Binance, Coinbase, Kraken — self-reported VDA, FEMA inbound limits, Schedule FA for foreign wallet, and 1% TDS self-deposit obligation.
Income from transfer of any VDA — Bitcoin, Ethereum, altcoins, NFTs, tokens — taxed at flat 30% plus surcharge and 4% cess. No deduction except cost; no slab benefit.
1% TDS on consideration paid for transfer of VDA. Indian exchanges deduct on sales; for P2P / foreign exchange, the buyer / taxpayer must self-deposit. Threshold: ₹50,000 / ₹10,000.
Loss from transfer of one VDA cannot be set off against gain from another VDA. Crypto loss cannot be set off against any other head — salary, business, capital gains. No carry-forward.
Includes any information / code / number / token (other than Indian or foreign currency) generated through cryptographic means, NFTs, and any other notified digital asset — broad scope.
Gift of VDA worth more than ₹50,000 is taxable in the hands of the recipient as "income from other sources" at slab rates — separate from the 30% transfer tax under Sec 115BBH.
Mandatory schedule in ITR-2 / ITR-3 — date of acquisition, date of transfer, cost, sale value, gain — for every VDA transaction. AIS feeds exchange data; mismatch triggers notice.
Indian crypto exchanges and Virtual Asset Service Providers must register with FIU-IND under PMLA — KYC, transaction reporting, and suspicious transaction reports for high-value users.
Crypto held on foreign exchanges (Binance, Coinbase) or self-custody wallets linked to foreign jurisdictions are reportable under Schedule FA — Black Money Act exposure for non-disclosure.
Transaction-level P&L preparation across Indian and foreign exchanges — CoinDCX, WazirX, ZebPay, Bitbns, Binance, Coinbase, Kraken — FIFO / specific-lot cost basis methodology.
Per-transaction Schedule VDA for ITR-2 / ITR-3 — date of acquisition, date of transfer, cost, sale value, gain — reconciled with AIS / Form 26AS to prevent mismatch notices.
TDS credit reconciliation for crypto transactions — Indian exchange deductions, P2P self-deposit via Form 26QE, and AIS verification — ensuring full credit in ITR.
End-to-end ITR filing for crypto investors and traders — ITR-2 / ITR-3 selection, Schedule VDA, Schedule CG / BP, capital gains, and audit applicability under Sec 44AB.
NFT creator income, secondary market trades, gas fee treatment, royalty stream — primary sale vs secondary VDA classification, and GST applicability on NFT-as-service.
Two-stage tax framework — acquisition stage (other income / business income at FMV) and subsequent transfer (Sec 115BBH 30%) — for mining rewards, staking yield, and DeFi income.
Binance, Coinbase, Kraken transaction reporting — Schedule VDA, Schedule FA for foreign wallet disclosure, FEMA / LRS compliance review, and Black Money Act risk mitigation.
Tax audit under Sec 44AB for high-volume traders crossing turnover thresholds — books of account preparation, Form 3CD reporting, and audit-grade transaction reconciliation.
Token launch tax architecture, founder and team vesting tax, treasury accounting, foreign DAO contributors, and inbound investment FEMA / FDI compliance for Web3 entities.
GST applicability on crypto exchanges, NFT marketplaces, Web3 SaaS, and crypto-denominated services — 18% GST analysis, place of supply determination, and export of services.
VASP registration support, KYC framework, CTR / STR reporting setup, and customer due diligence for crypto exchanges, OTC desks, and Indian Web3 platforms.
Response to Sec 143(1) intimations, defective return u/s 139(9), AIS mismatch notices, and Sec 148 reassessment — for missed crypto income, P2P trades, and foreign wallet holdings.
Any transfer of Bitcoin, Ethereum, altcoins, or NFTs in the financial year — Schedule VDA filing, 30% tax, 1% TDS credit, AIS matching mandatory.
Trading on Binance, Coinbase, Kraken, or other foreign exchanges — Schedule FA disclosure, FEMA LRS review, self-deposit 1% TDS via Form 26QE.
Peer-to-peer crypto trades on Indian or foreign platforms — buyer must self-deduct and deposit 1% TDS u/s 194S; both parties report in their ITR.
Earned crypto via mining, staking, liquidity provision, airdrops, or play-to-earn — taxable as income at FMV on receipt; subsequent sale taxed at 30% u/s 115BBH.
Created and sold NFTs, or traded NFTs on OpenSea, Rarible, or Indian platforms — primary sale vs secondary trade tax characterisation, gas fee treatment.
Receiving salary, bounty, or freelance fee in crypto / stablecoins — taxed as salary or business income at FMV on receipt; subsequent transfer attracts 30%.
Income tax intimation on missed crypto income — AIS shows exchange transactions not reported in ITR; revised / updated return needed within deadline.
Holdings acquired before 1 April 2022 — cost basis, indexation (not allowed), grandfathering analysis, and migration to Section 115BBH framework on subsequent transfer.
Collect P&L from all Indian and foreign exchanges, wallets, mining pools, NFT marketplaces, and DeFi protocols.
FIFO / specific-lot cost basis applied, transaction-wise gain / loss computation, and currency conversion to INR at transaction date.
Sec 115BBH 30% on net gain per VDA, surcharge and cess, 1% TDS credit reconciliation, and self-assessment tax computation.
Schedule VDA preparation for every transfer, Schedule FA for foreign wallets / exchanges, and AIS / TIS reconciliation.
ITR-2 / ITR-3 e-filing, e-verification, and on-call support for any subsequent intimation, mismatch, or scrutiny notice.
Partner with our specialist crypto tax consultants for transaction-level Schedule VDA filing, 1% TDS reconciliation, foreign exchange disclosure, mining / staking / NFT taxation, Web3 startup structuring, and end-to-end crypto ITR for AY 2026–27.
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