Crypto Tax India – 30% Flat Tax and 1% TDS on VDA
Calculate tax on Virtual Digital Assets (VDA) under Section 115BBH and prepare your ITR filing.
India introduced specific crypto tax rules effective April 2022. Under Section 115BBH of the Income Tax Act, gains from Virtual Digital Assets (VDA) are taxed at a flat rate of 30% – regardless of income level or holding period. Additionally, a 1% TDS applies to crypto transactions above the threshold. CoinTaxReporting tracks all VDA transactions and calculates gross gains for ITR filing.
Losses from VDA cannot be offset against income from other sources or other VDA transactions in the same year, and cannot be carried forward. Accurate gain calculation is therefore critical to avoid overpaying.
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What is the tax rate on crypto in India?
Section 115BBH imposes a flat 30% tax on gains from Virtual Digital Assets (VDA), including cryptocurrency, NFTs and other digital assets. This applies regardless of income bracket or holding period.
What is TDS on crypto in India?
1% TDS (Tax Deducted at Source) applies to crypto transactions. For most individuals, TDS is deducted by the exchange on transactions above ₹50,000 per year (₹10,000 for certain cases).
Can I offset crypto losses against other income?
No. Section 115BBH explicitly prohibits offsetting VDA losses against any other income, including other VDA gains. Each disposal is calculated independently.
Which ITR form is used for crypto?
Crypto gains are reported in ITR-2 (for individuals without business income) or ITR-3 (for those with business income), in the schedule for VDA.
India Crypto Tax – Section 115BBH explained
India's VDA tax framework is one of the strictest globally. The 30% flat rate applies to every gain, there is no holding period benefit, no basic exemption, and losses cannot reduce your total tax liability. Understanding exactly what is taxable – and what is not – is essential.
What counts as a taxable VDA event
- Sale of cryptocurrency for INR
- Swap of one cryptocurrency for another
- Purchase of goods or services with crypto
- Receipt of crypto as payment, mining reward, staking reward, or airdrop
- Gift of crypto above ₹50,000 in value (taxable in the recipient's hands)
The no-loss-offset rule – why it matters
Under Section 115BBH, a loss from selling one VDA cannot be used to reduce a gain from another VDA in the same year. This is a critical difference from most other countries. If you sell Bitcoin at a loss and Ethereum at a gain on the same day, you pay 30% on the Ethereum gain and cannot subtract the Bitcoin loss.
TDS – 1% deducted at source
Exchanges deduct 1% TDS on the sale consideration. This TDS is a credit against your final tax liability and is visible in Form 26AS. CoinTaxReporting tracks the total TDS deducted so you can reconcile it against your ITR filing accurately.
Cost of acquisition – the only deduction allowed
Section 115BBH allows only the cost of acquisition as a deduction. No trading fees, no infrastructure costs, no interest expenses. Gain = Sale price minus cost of acquisition, taxed at 30% flat.