Crypto Tax India: What You Need to Know About Reporting Crypto Gains
When you buy, sell, or trade cryptocurrency, digital assets like Bitcoin and Ethereum that are recorded on decentralized ledgers. Also known as digital currency, it is treated as property by India’s tax authorities. Any profit you make—whether from trading, staking, or selling—is taxable. Since 2022, India has required all crypto transactions to be reported, and the rules are strict: a flat 30% tax on gains, no deductions for losses, and a 1% TDS on every trade. This isn’t about speculation—it’s about compliance.
What you might not realize is that TDS (Tax Deducted at Source), a mandatory 1% withholding on every crypto transaction above ₹10,000 applies even if you’re just swapping one coin for another. If you bought Bitcoin in 2021 and sold it in 2024, the profit is taxed at 30%, even if you reinvested all the money. And if you received crypto as a gift, tip, or airdrop, that’s also taxable income at its fair market value. There’s no exemption for small amounts. The government tracks this through exchange data, wallet analytics, and bank statements linked to crypto purchases.
Many people think they can avoid taxes by using foreign exchanges or peer-to-peer trades, but that’s risky. The Income Tax Department has direct access to KYC data from Indian-linked wallets and payment gateways. If you used UPI to buy crypto, or cashed out to your bank account, it’s already on their radar. Even if you didn’t file a return, the system auto-matches your crypto activity with your PAN. The penalty for non-compliance? Up to 200% of the tax due, plus possible prosecution.
So what does this mean for you? You need a clear record of every transaction: date, amount, coin type, value in INR at time of trade, and whether it was a buy, sell, or transfer. Use a simple spreadsheet or a free crypto tax tool that supports Indian regulations. Don’t wait until March to start. If you traded in 2023 or 2024, you’re already behind. The system isn’t forgiving—it’s automated, and it’s watching.
Below, you’ll find real guides from traders and investors who’ve been through this. Some explain how to calculate gains on DeFi swaps. Others break down how to report staking rewards without getting flagged. A few warn about scams pretending to be tax consultants. This isn’t theory—it’s what people in India are actually doing to stay compliant without overpaying.
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