ITR filing 2026: Don't forget to report your cryptocurrency gains — Tax rules explained
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- India taxes income from virtual digital assets (cryptocurrencies and NFTs) at a flat 30% rate plus 4% cess, irrespective of short‑ or long‑term capital‑gain classification.
- ClearTax says a 1% TDS is levied on any crypto asset transfer (change of ownership), but is waived if total sales are ≤ ₹10,000 for individuals or ≤ ₹50,000 for businesses with turnover up to ₹1 cr (₹50 lakh for specified professions).
- Schedule VDA requires taxpayers to disclose crypto gains when filing their Income Tax Return, and gifting digital assets triggers tax liability for the recipient.
- ClearTax notes that crypto losses cannot be set‑off against any other income, unlike equity losses.
- Crypto bookkeeping software can consolidate transactions across exchanges and wallets to generate capital‑gain reports, though users must verify balances before finalising calculations.
Why it matters: Indian crypto investors must allocate 30% of profits plus 4% cess to tax and track every transfer for 1% TDS, increasing compliance costs and reducing net returns, while loss‑offset restrictions prevent offsetting crypto losses against other income.
