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Crypto assets will be taxed from April 1
March 31, 2022
Cryptocurrency assets will be taxed from the first April 2022. Tax @ 30% on Digital Assets: The gain on the sale of cryptocurrency would be taxed at a 30% tax rate. This taxation would certainly impact post-tax returns of cryptocurrency transactions. “Only deduction from sale consideration can be the cost of acquisition of cryptocurrency. There won’t be some other expenses allowed to be deducted. Because of no set-off of loss from different sources of income, it will turn out to be extremely difficult to have a net profitable trade in cryptocurrency,” said Sujit Bangar, Founder, Taxbuddy.com
If you purchased crypto for ₹15k and sold it for ₹45k, your straightforward gain is ₹30k.
TDS on cryptocurrency transactions, TDS @1% has been proposed for transactions including cryptocurrency. Sujit Bangar, Founder of Taxbuddy.com said that we might sell cryptocurrency at a benefit or loss however TDS @1% would certainly happen. “We can guarantee a discount of TDS done on a transaction involving loss. Therefore, it would be recommended to file an income tax return if you have entered form into transactions in cryptocurrency,” added Sujit Bangar.
The threshold limit for TDS would be ₹50,000 every year for specified people, which includes individuals/HUFs who are required to get their accounts audited under the I-T Act.
The provisions related to 1% TDS will come into effect from July 1, 2022, while the gains will be taxed effectively April 1. Crypto received as a gift will also be taxable.
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