Crypto Tax India: What You Need to Know About Reporting Crypto in 2025
When you buy, sell, or trade cryptocurrency, a digital asset that operates on blockchain technology and is treated as property by Indian tax authorities. Also known as digital assets, it is subject to strict reporting rules in India since 2022. Unlike stocks or gold, crypto isn’t just an investment—it’s a taxable event every time you trade, swap, or cash out. The Indian government doesn’t care if you used PancakeSwap on BSC, bought a meme coin like NIKEPIG, or earned tokens from a DAR airdrop. If you made a profit, you owe tax.
There are two main taxes you need to worry about: 30% income tax, a flat rate applied to all crypto gains, with no deductions for losses, and 1% TDS, a deduction taken at the time of every crypto transaction over ₹10,000. This means even if you swap one token for another—say, CAKE for $LZ—you trigger a taxable event. Losses don’t offset gains. You can’t carry them forward. And if you earn crypto from staking, airdrops, or mining, that’s treated as income and taxed at your full slab rate.
Many people think if they didn’t cash out to INR, they’re safe. That’s wrong. Selling Bitcoin for USDT? Taxable. Trading MIRA for PNDR? Taxable. Using KCS to pay for a service? Taxable. The rules don’t care about the medium—you’re moving value, and the government tracks it through exchange records, wallet addresses, and blockchain analytics. Platforms like KuCoin, MEXC, and NLexch may not report directly to the Income Tax Department, but they’re required to collect TDS. And if you’re audited, your transaction history on any exchange can be subpoenaed.
What about NFTs? If you bought an HUSL NFT and sold it later for a profit, that’s a capital gain. If you earned a NIGHT token from a Cardano airdrop and later sold it? Taxable. Even if the token’s value dropped to near zero—like Bitstar or PNDR—you still have to report the original fair market value at the time you received it. The tax isn’t based on whether you made money—it’s based on whether you received something of value.
There’s no official crypto tax calculator from the government, but you’re expected to track every transaction: date, amount, value in INR at time of trade, and whether it was a buy, sell, or swap. Many use third-party tools, but the burden of proof is on you. Keep screenshots, transaction IDs, and wallet addresses. If you don’t, and you’re flagged, you’ll have to explain every coin, every swap, every minute gain.
And yes—this applies to everyone. Whether you’re a student trading meme coins on weekends or a professional holding DeFi positions across multiple chains, the law doesn’t make exceptions. The Indian tax system treats crypto like any other asset class now: high risk, high scrutiny, and no mercy for ignorance.
Below, you’ll find real-world breakdowns of how crypto tax works in India—what’s taxable, what’s not, how to track it, and how to avoid common mistakes that lead to penalties. No theory. No fluff. Just what you need to do.
