Crypto TDS: If you buy and sell crypto, then understand all the provisions related to TDS.
Crypto TDS: Under the current policies of the central government, TDS (Tax Deducted at Source) of one percent is deducted on crypto trading. These provisions have become effective from 1 July 2022. In such a situation, if you trade in crypto like Bitcoin, then you should be aware of the new rules such as who will deduct TDS and at what rate. Apart from this, what are the provisions in the event of loss. The answers to all these questions are given below.
Who will deduct TDS on buying and selling of crypto?
The Central Board of Direct Taxes (CBDT) has made it clear that if you are buying crypto through an exchange, then the exchange will deduct TDS under section 194S. This TDS will also be deducted by the exchange in case of peer-to-peer transactions.
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What is the tax rate on crypto?
TDS is deducted at the rate of one percent on the purchase and sale of crypto, but if the ITR has not been filed in the last two years and the TDS amount in these two previous years is more than 50 thousand rupees, then crypto under section 206AB of the Income Tax Act 1961. TDS will be deducted at the rate of 5 percent on transactions related to
TDS details on any government portal?
You will be able to see the details of how much TDS has been deducted in Form 26AS. This is a consolidated annual tax statement issued by the tax department and can be viewed on the income tax website.
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Is it possible to claim crypto TDS?
While filing ITR for any financial year, tax deducted on crypto trade can be claimed as TDS.
What is the provision in case of loss?
Even if there is a loss in the buying and selling of crypto, you will still have to pay tax in the form of TDS.
Provision in case of foreign exchanges, P2P sites and DEXes?
International exchanges do not deduct TDS on crypto transactions. In such a situation, you will have to pay TDS yourself. If not, then it will be considered as a violation of the existing provision of Indian law. The same provision is with regard to trading of crypto through P2P sites i.e. peer-to-peer sites and Decentralized Exchanges (DEXes).
(Input: WazirX)
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