India Crypto Tax Calculator
Calculate Your Tax Liability
India applies a 30% capital gains tax plus 1% TDS on all crypto transactions. Accurate records are required for compliance.
When it comes to cryptocurrency restrictions in India, the goal isn’t to run from the law but to work within it. Since the Supreme Court decision of 2020 and the 2025 Income Tax (No. 2) Bill, crypto assets are legal to hold and trade, but they sit under a strict tax and anti‑money‑laundering (AML) framework. Below you’ll find a step‑by‑step playbook that lets you stay compliant, protect your assets, and avoid the pitfalls that trigger enforcement actions.
Understanding the Legal Landscape
India treats virtual digital assets (VDAs) as taxable property, not as legal tender. The definition lives in Income Tax Act, 1961 under Section 2(47A). Every transfer of a VDA attracts a flat 30% tax plus a 1% tax‑deducted‑at‑source (TDS). The Central Board of Direct Taxes (CBDT) issues the detailed guidelines, while the Financial Intelligence Unit‑India (FIU‑IND) enforces AML rules.
The Reserve Bank of India (RBI) does not recognise crypto as currency, and the Securities and Exchange Board of India (SEBI) is watching for any securities‑type token activity. In practice, the system works like a tax‑and‑reporting regime: as long as you register with FIU‑IND, keep clean records, and pay the 30% + 1% taxes, you can trade freely.
Tax Obligations and How to Calculate Them
Calculating crypto tax in India has three moving parts:
- Identify taxable events: selling crypto for fiat, swapping crypto‑to‑crypto, gifting, or using crypto to pay for services all count as transfers.
- Determine the fair market value (FMV) on the day of the event. Exchanges typically publish INR‑denominated price feeds; if you trade on a non‑INR pair, convert using the INR rate at the transaction timestamp.
- Apply the 30% flat rate on the capital gain (sale price minus cost basis). No deductions are allowed, even for transaction fees.
The 1% TDS is auto‑deducted by the exchange when you sell crypto for INR. If you use a peer‑to‑peer platform that doesn’t withhold TDS, you must remit it yourself before filing your annual return.
Practical tip: keep a spreadsheet that logs date, asset, amount, purchase price, sale price, FMV in INR, and tax withheld. Many users rely on free templates that calculate the quarterly tax liability automatically.
AML Compliance and FIU‑IND Registration
Since 2025, every virtual asset service provider (VASP) that offers services to Indian residents must register with FIU‑IND. The registration process involves:
- Submitting a detailed KYC policy that covers individual and corporate users.
- Implementing transaction‑monitoring software capable of flagging > INR10lakhs transfers.
- Designating a compliance officer who can receive and act on suspicious activity reports (SARs).
- Maintaining transaction logs for at least six years, as mandated by the Income Tax Act.
Failure to register leads to enforcement actions, as seen with platforms like BingX and LBank, which faced fines and temporary bans. Conversely, exchanges that have completed registration - such as Binance (India arm), WazirX, CoinDCX, and Zebpay - can provide users with official tax certificates.
Choosing Compliant Exchanges
Not all exchanges are created equal. Here’s a quick way to spot a compliant platform:
| Attribute | Compliant Exchange | Non‑Compliant Exchange |
|---|---|---|
| FIU‑IND Registration | Yes (e.g., WazirX, CoinDCX) | No or pending |
| KYC/AML Procedures | Full ID verification, source‑of‑funds checks | Basic email sign‑up only |
| Tax Documentation | Quarterly TDS statements, GST‑compliant invoices | None or ad‑hoc PDFs |
| Penalty Risk | Low - monitored but allowed | High - subject to seizure, account freeze |
When you sign up, verify the exchange’s FIU‑IND registration number (available on the FIU‑IND website). If it’s missing, walk away - the penalties for using an unregistered platform can include hefty fines and even criminal prosecution.
Practical Steps to Stay Within the Rules
- Open accounts only on FIU‑IND registered exchanges. Keep a screenshot of the registration page for your records.
- Enable two‑factor authentication (2FA) and use a hardware wallet for long‑term storage. While the law doesn’t force hardware wallets, they reduce the chance of loss, which could trigger tax complications.
- Maintain a master ledger. Capture every inbound and outbound transaction, including internal wallet moves. Tools like CoinTracker, Koinly, or a simple Google Sheet work fine.
- Calculate your quarterly tax liability using the ledger data. Pay the 1% TDS through the exchange’s auto‑deduction or remit it manually via the Income Tax Department’s portal.
- File your annual return before July31. Include ScheduleC for capital gains and attach the crypto tax certificate provided by your exchange.
- Engage a chartered accountant familiar with crypto. The tax code is complex, and professional advice can save you from costly errors.
Following this checklist typically takes 2-3weeks for a casual trader and up to two months for a small business that needs to integrate AML software.
Common Pitfalls and How to Avoid Them
- Using peer‑to‑peer platforms without KYC. These are flagged by FIU‑IND as high‑risk and can trigger SARs.
- Mistaking crypto‑to‑crypto swaps for tax‑free events. In India every swap is a taxable transfer, so you must record the FMV of both assets at the moment of the swap.
- Assuming the 30% flat tax applies only to profits. It actually applies to the entire transfer value after deducting the cost basis, so accurate cost records are essential.
- Keeping records for less than six years. The tax authority can audit back to the fiscal year of the transaction, and missing documents lead to penalties up to 200% of tax due.
By planning ahead and treating crypto like any other investment, you sidestep these traps.
Future Outlook
India is moving toward a more structured crypto framework rather than tighter bans. Expect clearer guidelines on stablecoins, DeFi lending, and tokenised securities in the next 12‑18months. Staying compliant now positions you to benefit from any upcoming incentives or reduced tax rates the government may introduce.
Frequently Asked Questions
Do I need to register my personal crypto wallet with FIU‑IND?
No. Only crypto exchanges and other virtual asset service providers (VASP) must register. Personal wallets are exempt, but you still need to report any gains on your tax return.
What happens if I forget to pay the 1% TDS?
The tax department can levy interest and a penalty of up to 200% of the unpaid amount. It’s easier to let the exchange deduct TDS automatically.
Can I use Binance if I’m an Indian resident?
Yes, provided you access the India‑specific version of Binance that has completed FIU‑IND registration. The platform will issue a tax‑certificate for your trades.
Is crypto considered a capital asset or business income?
If you trade as an individual, gains are treated as capital gains. If you run a trading business or a VASP, profits are ordinary income and taxed accordingly.
How long do I need to keep transaction records?
The Income Tax Act requires you to retain records for at least six years from the end of the relevant assessment year.
Jordan Collins
October 14, 2025 AT 01:12 AMMaintaining a clear ledger is the backbone of staying compliant; a simple Google Sheet with columns for date, asset, amount, FMV, and tax withheld does the trick.
Whenever you execute a trade, record the INR value at the exact timestamp to avoid disputes later.
Most exchanges now provide downloadable CSV statements that can be imported directly, saving you manual entry.
Don’t forget to reconcile your spreadsheet with the quarterly TDS certificates issued by your platform.
Consistent record‑keeping not only simplifies the annual filing but also protects you during any potential audit.
Andrew Mc Adam
October 20, 2025 AT 23:52 PMFirst off, let me commend anyone who even thinks about navigating the labyrinth of Indian crypto law – it’s no small feat.
You’ve got to register with FIU‑IND, which means submitting a KYC policy that reads like a novel and installing monitoring software that flags transfers over INR 10 lakhs, otherwise you’re courting trouble.
Once you’re on a compliant exchange, make sure the platform proudly displays its registration number; if it’s missing, walk away, period.
Every sale, swap, or even gifting triggers a taxable event, so you must capture the fair market value at that exact moment – no shortcuts.
The flat 30% tax applies to the entire transfer value after deducting cost basis, not just the profit, which catches many off‑guard.
Don’t rely on the exchange’s automated TDS alone; peer‑to‑peer trades require you to remit the 1% yourself, lest you face hefty penalties later.
Keep transaction logs for at least six years, as mandated; the tax department can dig that deep, and missing documents can lead to fines up to 200% of the tax due.
Engage a chartered accountant who knows crypto – their expertise can shave hours off your compliance burden and prevent costly errors.
Use tools like Koinly or CoinTracker to auto‑populate your ledger, but always double‑check the numbers against your own records.
Two‑factor authentication and hardware wallets are not legal requirements, but they drastically reduce the risk of loss, which would complicate your tax reporting.
When filing, attach the tax‑certificate provided by your exchange; it’s the proof the authorities want to see.
If you’re operating a small business that trades crypto, treat it as ordinary income and apply the same meticulous record‑keeping.
The good news is the Indian government is moving toward clearer guidelines, so staying compliant now puts you in a prime position for any future incentives.
Remember, the FIU‑IND now monitors VASPs closely; any slip‑up could trigger a suspicious activity report that spirals into an audit.
In short, treat crypto like any other investment – diligent, transparent, and fully documented – and you’ll sidestep the traps that ensnare the careless.
Shrey Mishra
October 27, 2025 AT 22:32 PMThe sheer volume of paperwork required can feel overwhelming, especially when every swap is deemed a taxable event.
Even though the language is formal, the practical impact on everyday traders is anything but simple.
Keeping six years of logs isn’t just bureaucracy; it’s a shield against punitive fines that could otherwise devastate a portfolio.
Ken Lumberg
November 3, 2025 AT 21:12 PMRespecting the law isn’t optional; it’s a moral imperative for anyone who claims to be a responsible citizen.
If you choose to dodge compliance, you’re not only risking fines but also undermining the integrity of the financial system.
Stay on the right side of the rules, and you’ll avoid unnecessary scrutiny.
Blue Delight Consultant
November 10, 2025 AT 19:52 PMOne might argue that compliance curtails the spirit of financial freedom, yet true liberty thrives within a framework that protects all participants.
When individuals act responsibly, the collective trust in the ecosystem strengthens, fostering innovation rather than repression.
Thus, adhering to the tax and AML guidelines can be seen as a philosophical commitment to societal harmony.
Balancing personal autonomy with communal responsibility is the hallmark of a mature market.
Wayne Sternberger
November 17, 2025 AT 18:32 PMFor newcomers, I recommend starting with a compliant exchange like WazirX or CoinDCX and taking screenshots of their FIU‑IND registration page.
Set up two‑factor authentication right away, and consider moving long‑term holdings to a hardware wallet for added security.
Draft a simple ledger in Google Sheets; list every inbound and outbound movement, even internal transfers.
Finally, schedule a quarterly review with a crypto‑savvy accountant to ensure your tax filings stay on track.