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Home > Income Tax > Cryptos Last Updated: Sep 21st 2022

Crypto Tax Help Center

An effort to help individuals, businesses who invest, transact, trade in Cryptos / VDAs, covering taxes like Income Tax, GST, TDS, Surcharge, and to support income tax return (ITR) filing in India.

Crypto Tax Help Center

Frequently Asked Questions

1. What is the difference between "Broker", "Exchange", "Intermediary"?

"Exchange" means any person / entity that operates an application or platform for transferring of VDAs, which matches buy and sell trades and executes the same on its application or platform.

"Broker" means any person / entity that operates an application or platform for transferring of VDAs and holds brokerage account / accounts with an Exchange for execution of such trades.

"Intermediary" could be either of the above based on the context.

2. Who should deduct and file 1% TDS

Per Income Tax Department, Section 194S shall come into effect from the 1st July 2022 to start deducting 1% on net consideration (after GST and exchange fees) above Rs. 50,000 for the financial year and file TDS using Form 26Q.

The responsibility to deduct TDS lie with the buyer of the VDA. In case an exchange or broker or an intermediary involved, who ever holds asset would be deducting the TDS and process the TDS accordingly. Per 194S, a clarification was given to have an agreement by an exchange with the person on the buyer side to deduct TDS and process accordingly.

Section 194S is applicable from Apr 1st 2022 to calculate TDS on the aggregate net consideration but TDS payment and filing of Form 26Q would start from 1st Jul 2022.

Deduction of TDS u/s 194S would not be applicable in case an individual buyer or HUF buyer having income under the head "profits and gains of business or profession", whose total sales / gross receipts / turnover from business carried on by him does not exceed one crore rupee or in case of profession exercised by him does not exceed fifty lakh rupee. This threshold is to be seen in the financial year immediately preceding the financial year in which the VDA is transferred.