How crypto tax works in India
Income from transferring virtual digital assets — crypto, notified NFTs, and similar tokens — is taxed at a flat 30% under section 115BBH, with no deduction beyond cost of acquisition.
Buyers deduct 1% TDS under section 194S above the monetary thresholds, losses cannot offset any income or carry forward, and gifts above the limit fall under section 56.
VDA income goes on Schedule VDA of the return, specified entities report under the CARF-linked framework, and exchange service fees carry 18% GST while the coins themselves do not.
Tax rates at a glance
- VDA gains
- 30%
- TDS on transfers
- 1%
- Loss set-off
- None
- Gift taxation
- Section 56
- Exchange fee GST
- 18%
- Mining income
- Taxable
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
Long-term holdersActive tradersFreelancers paid in cryptoExpatsNRIs
Watch out for
- The no-set-off rule is the harshest in major-economy crypto tax: each profitable trade pays 30% independently while losses die in the same year.
- TDS applies on gross consideration above thresholds, so high-turnover traders face cash-flow drag even in loss-making years, with credit only through Form 26AS.
- Gifts, airdrops, and salary tokens each trigger their own provisions, and CBDC and gift cards sit outside the VDA definition entirely.
- New-regime slab benefits, deductions, and loss harvesting do not soften VDA income, which sits outside the slab system by design.
Frequently asked questions
How is crypto taxed in India?
VDA transfer income faces a flat 30% plus surcharge and cess with only acquisition cost deductible. Buyers deduct 1% TDS, losses cannot offset anything, and reporting runs through Schedule VDA.
Can crypto losses offset gains in India?
No. Losses from one VDA cannot offset gains from another VDA or any other income, and cannot be carried forward. Every profitable disposal is taxed independently.
Is there GST on crypto in India?
Not on the coins themselves, but 18% GST applies to exchange service fees. TDS, income tax, and GST therefore stack on different legs of the same activity.