Indian Crypto Players Have A New Tax Rule From Today: What You Should Know

Indian cryptocurrency players will have to comply with a government order for a 1% tax deducted at source (TDS) on all cryptocurrency and non fungible token (NFT) transactions, starting today.

What Happened: The law, which the Prime Minister Narendra Modi-led government introduced during the Union Budget in February, will be effective from July 1 (Friday) for transactions of more than 10,000 rupees ($126).

The Central Board of Direct Taxes (CBDT) under the Indian Ministry of Finance said the tax will be deducted when the sum gets credited to the resident's account or at the time of payment, whichever is earlier. 

On April 1, the government introduced a 30% tax on all profits earned from cryptocurrency trading

How Crypto TDS Will Be Done

Peer-To-Peer Transaction: In a peer-to-peer transaction, with no broker or exchange involved, the buyer will be required to deduct the TDS under the given section, which will then have to be deposited with the government under relevant provisions of income tax rules.

Broker Or Exchange Transactions: When an investor transfers virtual digital assets (VDA) such as Bitcoin BTC/USDEthereum ETH/USD, and Dogecoin DOGE/USD through an exchange or a broker, the tax may only be deducted by the exchange which is crediting or making payment to the seller.

For NFTs, Other VDAs: If an exchange owns VDA, the buyer or his broker is primarily responsible for deducting the TDS. However, the parties may enter a written agreement to pay the tax for all such transactions.

For Crypto To Crypto Transactions: In these transactions, the TDS must be deducted in cryptocurrency alone. The government notification said the cryptocurrency would be required to be converted into Indian rupees by 11.59 PM on the same day.

Read Next: Coinbase To Lay Off 8% Of India Team — But Makes This Key Top-Level Hire

Photo via Cryptographer on Shutterstock


Posted In: BitcoinEurasiaIndiaNarendra ModiTDSCryptocurrencyGovernmentNewsRegulationsEducationGlobalMarketsGeneral

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.