India Crypto Tax: What You Need to Know

When dealing with India crypto tax, the set of rules that apply to cryptocurrency transactions in India, covering income tax, GST, and capital gains. Also known as crypto taxation India, it determines how profits, losses, and even token swaps are reported to the tax authorities.

Another core piece of the puzzle is crypto tax, the broader framework used worldwide to tax digital asset activities. In India, crypto tax requires traders to calculate capital gains for each sale or exchange, treat airdrops as taxable income, and consider GST on services related to crypto platforms. Meanwhile, capital gains tax, a tax on the profit from selling an asset is levied at 30% for crypto, regardless of holding period, plus a 1% cess and surcharge. The tax law also distinguishes between short‑term and long‑term holdings for other assets, but crypto stays at a flat rate, making compliance straightforward yet strict.

Key Aspects of India Crypto Tax

Besides the capital gains rate, the Goods and Services Tax (GST, a consumption tax applied to the provision of services in India) can bite crypto users when they purchase services from exchanges, such as transaction fees or custodial services. The tax authority views these as taxable supplies, so exchanges often add a 0.25% GST charge on each transaction. Ignoring this can lead to penalties, and the amount adds up quickly for high‑frequency traders. India crypto tax also influences how investors plan their portfolios. Knowing that every crypto‑to‑crypto swap is a taxable event pushes many to consolidate trades, use loss‑harvesting strategies, and keep detailed records. The Income Tax Department now mandates that exchanges report user trading data through a new TDS (Tax Deducted at Source) mechanism, where a 1% tax is deducted on each sale above a certain threshold. This upfront deduction simplifies compliance for casual investors but requires careful reconciliation when filing annual returns. For freelancers and businesses earning in crypto, the tax treatment expands further. Income earned as payment for services is treated as business income and taxed according to the applicable slab rates, with GST obligations if the service is taxable. Proper invoicing and conversion of crypto receipts into INR at the fair market value on the receipt date are essential to avoid disputes. Staying compliant means keeping a ledger that captures purchase dates, acquisition costs, sale proceeds, transaction fees, and the applicable GST per trade. Many traders turn to dedicated crypto tax software that can import exchange CSV files, automatically calculate the 30% capital gains, apply the 1% TDS, and generate a consolidated tax report ready for filing. Understanding the relationship between India crypto tax, capital gains, and GST helps you avoid surprise liabilities and make smarter trading decisions. It also ensures you’re prepared for any future changes, as the government regularly reviews crypto policy.

Below, you’ll find a curated collection of articles that break down each component in detail – from how the 30% capital gains tax is applied, to step‑by‑step guides on filing your crypto returns, to the latest updates on GST charges and TDS deductions. Dive in to get the actionable insights you need to stay ahead of the tax curve.