India Cryptocurrency Tax Explained

When dealing with India cryptocurrency tax, the legal framework that dictates how crypto gains, losses, and transactions are taxed for individuals and businesses in India. Also known as crypto tax India, it shapes how you report trades, calculate liabilities, and stay on the right side of the law.

India cryptocurrency tax encompasses several moving parts. First, taxable events, any crypto activity that triggers a tax liability, such as selling, swapping, or using crypto to pay for goods define when you owe money. Second, the FIU‑IND, the Financial Intelligence Unit of India that oversees crypto compliance and reporting requirements influences which platforms you can trust. Finally, using compliant exchanges, registered crypto trading venues that follow FIU‑IND guidelines and provide tax‑friendly statements makes record‑keeping far easier. In short, the tax regime requires you to identify events, calculate gains, and file the proper forms.

How to File and Stay Compliant

Filing your crypto taxes in India follows the same schedule as regular income tax: you report on Form ITR‑2 or ITR‑3, depending on your other income sources. The process starts with gathering transaction data from your exchanges—most compliant platforms now offer CSV exports that break down each trade. Once you have the data, classify each line as a sale, purchase, or swap, then compute the capital gain or loss by comparing the sale price with the cost basis. Remember, long‑term holdings (more than 36 months) receive a lower tax rate than short‑term trades.

After calculations, enter the net gain in the “Capital Gains” section of the ITR form. If you have incurred losses, you can offset them against other capital gains, but not against salary income. The final step is to pay any tax due before the due date, usually July 31st for the previous fiscal year. Missing the deadline or under‑reporting can trigger penalties, and the FIU‑IND has started flagging non‑compliant wallets, so staying accurate is critical.

Beyond filing, you should keep detailed records for at least six years. This includes transaction logs, exchange statements, and receipts for any crypto‑related expenses like transaction fees or mining costs. Good documentation not only satisfies auditors but also helps you answer any future queries from the tax department.

Many traders wonder whether they need to report small trades or occasional airdrops. The rule of thumb is: if the value exceeds ₹5,000 in a financial year, it counts as a taxable event. Airdrops, staking rewards, and DeFi yields are treated as “income from other sources” and must be declared at the fair market value on the day you receive them. Ignoring these can lead to surprise tax bills later.

To make life easier, consider using a crypto tax calculator that integrates with Indian exchanges. These tools automate the cost‑basis computation, apply the correct holding period rates, and generate a ready‑to‑file report. While they’re not mandatory, they cut down on manual errors and speed up the filing process.

In the articles below you’ll find deep dives on compliant exchanges, step‑by‑step filing guides, and the latest updates from the FIU‑IND. Whether you’re a beginner just starting to trade or a seasoned investor managing a large portfolio, the collection gives you practical insights to stay tax‑ready and avoid costly mistakes.