In the recent Union Budget, Finance Minister Nirmala Sitharaman proposed a new taxation policy on virtual digital assets, which would include cryptos, Non-Fungible Tokens, etc. among other digital assets. Here is all you need to know about the new tax regime.
Flat 30 per cent tax on Gains
All gains derived on sale of virtual digital assets, or VDAs, which includes cryptocurrencies, would be taxed at a rate of 30 per cent. There is no threshold under which taxes would not be levied.
1 per cent TDS
A 1 per cent TDS would be deducted on all cryptocurrency transactions, irrespective of profit or loss.
It is noteworthy to mention that in case of loss, the taxpayer would be provided with a refund on the TDS paid.
Also, the provisions relating to TDS would be applicable from July 1.
Under the new tax policy, no set offs of crypto losses would be available. Taxpayers would not be able to set off their profits incurred on cryptocurrencies with any kinds of losses, be it between two crypto assets or any other asset and crypto assets.
Under the new tax policy, carry forward of losses is not allowed.
Tax payers would not have the option to carry forward their crypto losses to the next financial year.
Under the new taxation policy, no deductions, including cost of acquisition, etc., would be allowed in the case of virtual digital assets, which would include cryptocurrencies. This also includes cost of mining cryptocurrencies.
Most of these provisions kick in from today.
The provision for TDS kicks in from July 1.
Also Read: Maharashtra's Gadchiroli to issue caste certificates via blockchain platform Polygon
Also Read: Crypto crime: Pune police recovers over Rs 84 cr worth of Bitcoins
Copyright©2023 Living Media India Limited. For reprint rights: Syndications Today