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Crypto Consulting Services – Cryptocurrency Tax & Compliance Advisory in India

Expert Guidance on Cryptocurrency Taxation, VDA Compliance, and TDS Under the Income Tax Act, 1961

India's cryptocurrency and Virtual Digital Asset (VDA) taxation framework, introduced by the Finance Act 2022, has made crypto compliance one of the most complex and rapidly evolving areas of Indian tax law. Under Section 115BBH, all gains from transfer of VDAs (including Bitcoin, Ethereum, NFTs, and other crypto assets) are taxed at a flat 30% (plus surcharge and cess), with no deduction allowed other than the cost of acquisition. Additionally, Section 194S mandates TDS at 1% on every transfer of VDA above the specified threshold, creating ongoing TDS compliance obligations for crypto traders, exchanges, and P2P transaction participants.

Non-compliance with VDA tax provisions — including failure to report crypto income in ITR, non-deduction of TDS on crypto transfers, and failure to disclose crypto assets in Schedule VDA — attracts significant penalties under Sections 270A and 272A, and potential prosecution. Our specialists provide comprehensive cryptocurrency consulting across all compliance dimensions. This service connects with Crypto Tax Filing, TDS on Crypto P2P Transactions, File ITR for Cryptocurrency, and New Income Tax Forms 2026.

Our Crypto Consulting Services

VDA Tax Computation

Accurate computation of Section 115BBH tax at 30% on all VDA transactions — covering spot trades, swaps, staking rewards, airdrops, NFT sales, and mining income — with transaction-by-transaction gain/loss analysis.

Crypto Portfolio Reconciliation

Complete reconciliation of your crypto portfolio across all exchanges (WazirX, CoinDCX, Binance, etc.) and wallets — compiling transaction history, computing cost of acquisition, and determining net taxable gains.

TDS on VDA Compliance

Advisory and compliance support for TDS obligations under Section 194S — covering exchange-level TDS, P2P TDS obligations, Form 26QE filing (for specified persons), and deductor registration requirements.

Schedule VDA in ITR

Correct reporting of all VDA transactions in Schedule VDA of the income tax return — ensuring every transfer, gain, and loss is disclosed accurately to avoid defective return notices and scrutiny.

Crypto Loss Advisory

Strategic advisory on crypto loss utilisation — under Section 115BBH, VDA losses cannot be set off against any other income or carried forward, requiring careful tax planning to minimise the financial impact of market losses.

Foreign Crypto Exchange Compliance

Guidance on reporting of crypto assets held on foreign exchanges in Schedule FA (foreign assets) of the ITR and implications under FEMA, Black Money Act, and automatic exchange of information (AEOI) frameworks.

Why Expert Crypto Tax Advisory Is Essential in India

  • The 30% flat tax on VDA gains with no loss set-off or carry-forward makes crypto one of the most heavily taxed asset classes — professional planning is essential
  • Non-disclosure of crypto income in ITR attracts penalties under Section 270A and potential best judgment assessment under Section 144
  • TDS under Section 194S creates ongoing compliance obligations for frequent traders and P2P transaction participants that are easy to miss
  • Crypto assets held on foreign exchanges must be disclosed in Schedule FA — omission can attract proceedings under the Black Money Act with very severe penalties
  • Staking rewards, airdrops, and mining income have unclear characterisation — professional guidance ensures the most defensible tax position
  • Rapid regulatory evolution means the crypto tax landscape changes frequently — specialist advisors stay current so you don't face unexpected demands

Frequently Asked Questions – Crypto Consulting Services

How is cryptocurrency taxed in India under the Income Tax Act?
Under Section 115BBH (effective from April 1, 2022), income from transfer of any Virtual Digital Asset (VDA) — including Bitcoin, Ethereum, all altcoins, NFTs, and other crypto assets — is taxed at a flat rate of 30% plus applicable surcharge and cess. The only deduction permitted is the cost of acquisition of the VDA — no deduction for expenses, TDS paid, or any other costs. VDA losses cannot be set off against gains from other VDAs, against any other head of income, or carried forward to subsequent years. Every crypto transaction must be reported in Schedule VDA of the ITR.
Does TDS apply to cryptocurrency transactions in India?
Yes. Section 194S requires TDS at 1% on the amount (or fair market value) of VDA transferred — deducted by the buyer/exchange. The threshold is Rs. 50,000 per year for specified persons (individuals/HUFs with business/professional turnover below Rs. 1 crore or Rs. 50 lakh for the preceding year) and Rs. 10,000 per year for all others. TDS on exchange-traded VDA is deducted by the exchange. For P2P transactions, the buyer is responsible for deducting and depositing TDS using Form 26QE (for specified persons) or Form 26Q (for others). Non-deduction of TDS under Section 194S makes the buyer liable as assessee-in-default.
Are staking rewards and airdrops taxable in India?
Yes, but the specific characterisation is evolving. Staking rewards (earned by validating blockchain transactions) and airdrop receipts are generally considered income in India — either as income from other sources under Section 56(2) or as business income, depending on the taxpayer's activity level. The value at the time of receipt (market price) is the income amount. The VDA received then has that value as its cost of acquisition for the purpose of Section 115BBH when it is subsequently transferred. Mining income (earned by providing computational power) is generally treated as business income rather than VDA transfer income.
Can I set off a cryptocurrency loss against profits from stocks or other investments?
No. Under Section 115BBH(2), losses from transfer of VDA cannot be set off against income from any other head — including capital gains from stocks, mutual funds, or property. Losses from one VDA also cannot be set off against gains from another VDA within the same year. Additionally, VDA losses cannot be carried forward to subsequent years for set-off. This makes crypto loss management particularly challenging and highlights the importance of professional advisory — the only way to reduce VDA tax exposure is through accurate cost of acquisition documentation and legal structuring of transactions.
Do I need to report crypto assets held on foreign exchanges?
Yes. Crypto assets held on foreign exchanges (such as Binance, Coinbase, Kraken, etc.) must be disclosed in Schedule FA (Foreign Assets) of your ITR, as they constitute foreign assets held by an Indian resident. Failure to disclose foreign assets — including crypto — can attract proceedings and penalties under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, with penalties up to three times the tax on undisclosed assets plus flat penalties of Rs. 10 lakh per non-disclosure. India also receives data on foreign asset holdings through AEOI (Automatic Exchange of Information) frameworks, making non-disclosure increasingly difficult to sustain.

Navigate India's Crypto Tax Laws with Expert Guidance.

Our VDA tax specialists handle your crypto portfolio reconciliation, ITR filing, TDS compliance, and foreign asset disclosures.

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F.A.Q.

It includes all yearly requirements such as filings, actuarial valuation, audits, and maintaining proper records.

Yes, regular compliance is required to maintain approval and tax benefits.

It helps determine the exact gratuity liability and required funding for the trust.

 

Yes, trusts must file necessary returns and maintain financial records as per regulations.

Non-compliance can lead to penalties, loss of tax benefits, or cancellation of approval.

Trustees and the employer are responsible for ensuring proper compliance.