Cryptocurrency (VDA) adoption has been rising rapidly in India. With popularity, we are moving towards proper regulations which is very important for the industry’s growth.
The Hon’ble Finance Minister Mrs. Nirmala Sitharaman has released updates related to the taxation of VDAs (Cryptocurrencies) in The Finance Bill 2022.
The Finance Bill 2022 has proposed a completely new TDS section, 194S, in the Income Tax Act, This new section will be made effective from 1st July 2022 which will levy 1% TDS on the transaction value and withhold it to further pay to the government.
As per this bill:
- Income from the transfer and trade of VDA (virtual digital asset or cryptocurrency) will be taxed at the rate of 30%.
- 1% TDS will be levied on transactions and trades of virtual assets, above a certain limit
- Anyone receiving a gift in form of VDA has to pay taxes from their end
Further details on TDS:
INR <> Crypto Trading Pairs
- TDS will not be deducted while buying Cryptocurrency using INR
- The seller is liable to pay TDS which will be deducted directly by Bitbns
Crypto <> Crypto Trading Pairs
- Both seller and buyer are liable to pay TDS while doing Crypto to Crypto trades in the USDT market
- Bitbns would be deducting 1% from both buyer and seller in this case`
If someone has not filed tax for the last 2 years and the amount is 50,000 INR or above for each of these years then you are liable to pay 5% TDS as per The Finance Bill of 2022. Further details have been mentioned in the images above.
Futures trading
- There is no TDS on futures trading. We will launch it very soon along with Options mainnet.
Feel free to contact us if you have any questions or queries regarding TDS on Cryptocurrencies.
Onwards and Upwards,
Team BitBns
