For Indian crypto users, the main rules to understand are that income from transferring a virtual digital asset (VDA) is subject to a special tax provision, qualifying transfers can attract tax deducted at source (TDS), and covered VDA service providers must register with FIU-IND. None of those rules means an exchange is government-approved, that your balance is insured, or that a withdrawal will arrive by a universal deadline. The details below reflect official material accessed on October 7, 2026; the law and return requirements applicable to your transaction year matter.
How much tax do I pay on crypto profits in India?
The Income Tax Department’s cited text for section 115BBH sets a 30% rate on income from the transfer of a VDA. It is not a 30% tax on every sale’s gross amount: the provision concerns income computed from the transfer, and the transaction’s classification, acquisition cost, applicable year and individual facts matter. The cited page says that, in computing this income, deductions other than cost of acquisition are not allowed, and a VDA transfer loss cannot be set off against income computed under another provision or carried forward. See the Income Tax Department’s section 115BBH text.
The 30% figure is the statutory rate described on that page, not a complete all-in effective rate. The department’s separate 2026 VDA guidance describes 30% plus surcharge and cess. Because the applicable law and tax-year transition can affect filing, check the provisions and official guidance for the relevant year and get qualified tax advice for your return. The Income Tax Department’s Income-tax Act, 2025 index identifies the 2025 Act, 2026 rules and transition materials; do not assume the cited 1961 Act page alone resolves how a later year applies.
Can I set off a loss on one coin against a gain on another?
Do not assume a loss on one VDA can reduce a gain on another, or offset salary, business or other income. The cited section 115BBH text bars setting a VDA transfer loss off against income computed under another provision and bars carrying it forward; the department’s Schedule VDA instructions describe a loss entry as nil. How the rules apply to your transactions and return should be confirmed for the relevant year with a qualified tax professional.
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Is 1% TDS the same as my crypto tax?
No. Section 194S provides for 1% TDS on consideration paid to a resident for a VDA transfer when its conditions apply. TDS is tax deducted at source; it is not, by itself, the final calculation of tax on your VDA income. The Income Tax Department’s guidance describes deduction at payment or credit, whichever is earlier, and additional arrangements for transactions through exchanges and brokers. It also discusses non-resident payments under section 195, so the resident rule should not be assumed to apply identically to every counterparty or transaction. Read the department’s section 194S guidance.
The guidance gives different aggregate-consideration thresholds: ₹10,000 for a specified person and ₹50,000 for a specified individual or Hindu undivided family (HUF) payer, as defined there. Which threshold applies depends on the payer category and legal conditions; there is no single threshold to apply without checking those definitions. Reconcile TDS records against your tax statements and report transactions in the return applicable to the year. Do not assume an exchange report covers activity on other platforms or wallets or completes your filing.
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What crypto transaction records should I keep for my return?
The Income Tax Department’s Schedule VDA guidance describes transaction-by-transaction reporting, including acquisition date, transfer date, income head, acquisition cost, consideration and computed income. Keep records that help you verify those fields and reconcile TDS, such as:
- Dated transaction exports, order or trade confirmations, and deposit and withdrawal records from each platform you used.
- Wallet transaction identifiers and records supporting acquisition dates and costs.
- TDS records and tax statements relevant to the transactions.
This is a practical recordkeeping checklist based on the information Schedule VDA asks for, not a claim that each item is a separately mandated document in every case. Preserve records across platforms and wallets so you can check them against the transaction-level entries in your return.
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Why does an exchange ask for KYC, and does FIU registration mean it is approved?
Identity checks are part of a provider’s compliance and account processes, but the official material cited here does not establish one universal document list, verification time or account-approval standard for every exchange. Check the provider’s current official instructions for the documents and steps it requires.
The Government of India says VDA service providers operating in India, whether onshore or offshore, must register with FIU-IND as reporting entities when they carry out covered activities. These include exchange between VDAs and fiat, VDA transfers, safekeeping or administration, and instruments enabling control over VDAs. The providers must comply with obligations under the Prevention of Money-Laundering Act and its rules. The Press Information Bureau release describes the requirement; it does not establish that any particular provider is currently registered. Check current FIU-IND records before relying on a provider’s status.
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Registration is a reporting and compliance requirement, not a government endorsement of an investment or a guarantee of solvency, balance insurance, account access or dispute resolution. The Government of India release warns: “The Crypto products and NFTs are unregulated and can be highly risky.” That warning is not a substitute for checking the legal and operational details of a particular service.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Is my crypto safer on an exchange or in my own wallet?
Neither option is automatically safer for every user. With exchange custody, access is mediated through the platform and its account controls; what happens if an account is restricted, the provider has an operational problem or a withdrawal is unavailable depends on that provider and its arrangements. With self-custody, you take direct responsibility for controlling and protecting the credentials or keys that authorize access. Losing those credentials or a recovery backup can mean losing access.
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| Consideration | Exchange custody | Self-custody |
|---|---|---|
| Access and control | Access is through the exchange account and its custody arrangements. | You control the credentials or keys needed to access the assets. |
| Recovery | Account recovery and restrictions depend on the provider’s processes. | You are responsible for recovery credentials and backups; losing them can prevent access. |
| Operational responsibility | You must protect account access and evaluate the provider’s controls and support. | You must secure credentials and backups and use compatible assets and networks. |
A hardware wallet is one possible self-custody tool, not a government recommendation or a guarantee against loss. Before choosing any method, consider how recovery works, how you will protect backups, whether the asset and network are supported, and any transfer fees. A wallet does not remove tax or other legal obligations.
Why is my crypto or INR withdrawal pending?
There is no universal withdrawal timetable established by the official sources cited here. A crypto transfer to an external wallet and an INR withdrawal to a bank account are different processes, and a delay may depend on the exchange’s current policy, verification status, asset, network, maintenance, risk checks, bank rails or your account. Check the selected provider’s current official help material for processing estimates, minimums, fees, limits, supported networks, address-whitelisting rules and INR withdrawal steps.
Before initiating a crypto transfer, confirm that the asset and network match the receiving destination. Blockchain transfers may be difficult or impossible to reverse. For a pending INR withdrawal, use the provider’s stated support or complaint route and keep the withdrawal reference and relevant bank details available. Do not assume that crypto and INR withdrawals share the same processing steps or credit times.
What should I compare before choosing an exchange?
Compare current, provider-specific terms rather than relying on a ranking or a registration claim alone. Verify each item in the exchange’s own documentation and current official records where applicable:
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- Which assets and networks it supports, including for deposits and external withdrawals.
- INR deposit and withdrawal access, fees, limits and processing steps.
- Whether withdrawals to an external wallet are enabled and under what conditions.
- Custody arrangements, account-recovery process and security controls.
- Whether transaction and TDS records are available and exportable for your own reconciliation.
- How to contact support and escalate a complaint.
Policies and availability can change, and these checks cannot guarantee a provider’s future performance. Tax reporting remains your responsibility across the platforms and wallets you use.
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