🏦 Taxes on Crypto in India: 7 Essential Facts Every Investor Must Know
Crypto trading, DeFi, and NFTs are booming in India—but so is regulatory scrutiny. Below are the 7 essential facts about crypto taxes in India for 2025, helping you stay compliant and secure.
1. 💸 Flat 30% Tax on Crypto Gains
Crypto gains—from selling, trading, spending, or swapping—are taxed at a flat 30%, plus 4% cess and any surcharge. There is no distinction between short-term and long-term, and only the cost of acquisition is deductible.
2. 📋 Mandatory 1% TDS on Transactions
A 1% TDS applies to every crypto transfer—on centralized exchanges, P2P platforms, even swaps—above ₹10,000 for salaried users and ₹50,000 for businesses.
3. ⛔ Losses Cannot Be Offset or Carried Forward
Crypto losses cannot be offset against gains from other crypto or financial assets—and cannot be carried forward .
4. 📝 Schedule VDA Reporting Is Compulsory
From FY 2024–25 onwards, all crypto-related activity must be reported under Schedule VDA in ITR‑2 or ITR‑3. Exchanges are required to share transaction data with the income tax department.
5. 🚨 Penalties on Undisclosed Income (Up to 70%)
From 1 Feb 2025, crypto is considered “undisclosed income” under Section 158B—triggering assessments up to 6 years back, with penalties up to 60–70% on unreported crypto gains. Authorities are actively issuing notices and seizing wallets
6. 🪙 Mining, Staking, Airdrops & Gifts Are Taxed
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Mining/Staking/Airdrops: taxed as “Income from Other Sources” at the individual slab rate, plus 30% on gains if tokens are later sold
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Gifts over ₹50,000: taxable as income of the recipient
7. 🌐 Enhanced Global Compliance and Exchange Reporting
India aligns with the OECD’s Crypto-Asset Reporting Framework (CARF), increasing global exchange data sharing. Indian platforms must enforce KYC, TDS reporting, and transaction disclosures
🧠 Useful Links
📚 Resources
❓ FAQ – Taxes on Crypto in India
Q1: What is the current tax rate on crypto gains in India?
A: A flat 30%, plus 4% cess and surcharge—applies to all gains without distinction .
Q2: Is TDS deducted on my crypto trades?
A: Yes—a 1% TDS on every crypto transfer above ₹10,000 (salaried) or ₹50,000 (business).
You must report and submit it if trading P2P or offshore .
Q3: Can I set off crypto losses against my income?
A: No. Crypto losses cannot be used to offset gains from crypto or other sources .
Q4: Why must I report crypto in Schedule VDA?
A: It ensures regulatory transparency—exchanges submit data, and failure to declare can trigger penalties or legal action .
Q5: What happens if I don’t report crypto income?
A: Undisclosed income can lead to retroactive assessments, wallet seizures, and penalties up to 60–70% .
✅ Final Thoughts
India’s crypto tax regime is now robust and strictly enforced. To avoid penalties or legal trouble, it’s vital to report every crypto activity, pay the flat tax, deduct TDS, and retain accurate records.
For seamless compliance and smarter tax planning, visit bit2050.com—your go-to resource for decentralized finance and digital asset guidance.
