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How India taxes crypto: a flat 30%, 1% TDS, and no relief for losses
Sell crypto at a profit in India and 31.2% of the gain goes in tax, whatever your income. Losses get no relief at all. Here is how it works, with an example.
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Since April 2022, India has taxed crypto and similar tokens, which the law calls virtual digital assets or VDAs, under its own special rules. They are much stricter than the rules for shares or mutual funds.
The three rules
- 30% flatGains are taxed at a flat 30%, plus 4% cess, so 31.2% in all, whatever your income slab and however long you held the coin. This came in as Section 115BBH.
- Only cost countsThe only thing you can deduct is what you paid for the coin. No deduction for exchange fees, internet bills or anything else.
- No loss reliefA loss on one coin cannot be set off against a gain on another, or against any other income, and it cannot be carried forward.
An example
Say you bought crypto for ₹60,000 and sold it for ₹1,00,000. Your profit is ₹40,000. Tax at 30% is ₹12,000, plus 4% cess of ₹480: ₹12,480. You keep ₹27,520 of the profit. Surcharge for very high incomes would add more.
The 1% TDS
Separately, 1% of the sale value is deducted as tax at source when you sell, above set limits. On the ₹1,00,000 sale above, that is ₹1,000. It is not an extra tax: you can claim it against your final bill when you file your return. The TDS rule came in as Section 194S in July 2022; under the new Income-tax Act, 2025 it sits in Section 393.
Try your own numbers with our crypto tax calculator. Educational content only, not tax advice: check your own case with a chartered accountant.
Educational content only. Not investment advice. Spotted an error? Tell us.
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