#cryptotaxindia

Crypto Tax in India 2026: 30% Tax, 1% TDS & Filing Rules | CryptoWire

What Is Crypto Tax in India?

The Indian government classifies cryptocurrencies as Virtual Digital Assets (VDAs) for taxation purposes.

This includes:

Bitcoin (BTC)

Ethereum (ETH)

Solana (SOL)

XRP

Meme coins

NFTs

Other crypto assets

Income earned from transferring VDAs is taxed at a flat 30% rate plus applicable surcharge and cess.

Is Crypto Tax 30% in India?

Yes. One of the most searched questions is:

“Is crypto tax 30% in India?”

The answer is yes.

Any profit earned from selling cryptocurrency is generally taxed at a flat 30% rate regardless of:

Holding period

Asset type

Investor category

Unlike stocks and mutual funds, crypto assets do not currently receive preferential long-term capital gains treatment.

How Is Crypto Tax Calculated in India?

Let’s understand with a simple example.

Example

You purchased Bitcoin for ₹1,00,000.

Later, you sold it for ₹1,50,000.

Profit:

₹1,50,000 − ₹1,00,000 = ₹50,000

Tax:

30% of ₹50,000 = ₹15,000

Applicable surcharge and cess may increase the final tax liability.

What Is 1% TDS on Crypto?

Apart from the 30% tax, India introduced a 1% TDS requirement on certain crypto transfers.

The purpose is to help tax authorities track cryptocurrency transactions and improve compliance.

Many Indian exchanges automatically deduct TDS when eligible transactions occur.

Do You Pay Tax If You Don’t Sell Crypto?

This is another frequently asked question.

If You Only Hold Crypto

Generally, merely holding cryptocurrency without transferring or selling it does not create a taxable profit event.

If You Sell Crypto

Any realized gain may become taxable under VDA taxation rules.

Investors should maintain accurate transaction records for tax reporting purposes.

Are Crypto-to-Crypto Trades Taxable?

Yes.

Many investors assume swapping one cryptocurrency for another avoids taxes.

For example:

Bitcoin to Ethereum

Ethereum to Solana

XRP to USDT

Such transfers may still have tax implications depending on the transaction and resulting gains. Investors should consult qualified tax professionals when calculating liabilities.

ITR for Cryptocurrency in India 2026: Schedule VDA Filing Guide | CryptoWire

Crypto in India is treated as a Virtual Digital Asset (VDA) under Section 2(47A) of the Income Tax Act. Any income from transferring a VDA selling, swapping, or spending it must be declared in your Income Tax Return.

The framework was introduced in Budget 2022 and has only tightened since.

The rate is blunt. Under Section 115BBH, profits are taxed at a flat 30% plus a 4% health and education cess, regardless of your income slab or holding period. There is no distinction between short-term and long-term gains.

(Source: Koinly, CoinDCX)

Which ITR form should I use for crypto?

Use ITR-2 if you hold crypto as an investment and report capital gains.

Use ITR-3 if you trade actively and treat crypto as business income. Both forms contain Schedule VDA, where each transaction is reported separately aggregated or summary entries are typically rejected.

(Source: Patron Accounting, KoinX)

How do I report crypto in Schedule VDA?

Schedule VDA requires transaction-wise detail: date of acquisition, date of transfer, cost of acquisition, sale consideration, and the resulting income.

Only the purchase price is deductible gas fees, exchange fees and brokerage costs cannot be claimed. (Source: Patron Accounting)

Schedule VDA reporting became mandatory from FY 2025-26 onwards. Before filing, download Form 26AS and your AIS, then match the 1% TDS recorded under Section 194S against your declared transactions. A mismatch can trigger a defective-return notice. (Source: KoinX)

What is the 1% TDS on crypto (Section 194S)?

Section 194S levies a 1% TDS on VDA transfers, effective since 1 July 2022. The threshold is ₹50,000 a year for individuals without business income (specified persons) and ₹10,000 for others.

The TDS is not an extra tax. It is a credit you adjust against your final 30% liability, or claim as a refund when filing. Indian exchanges such as CoinDCX deduct it automatically and report it to users.

Stay Compliant: File Taxes for Your Crypto Gains with Ease