Crypto Tax in India 2026: 30% Tax, 1% TDS and Schedule VDA Explained

Crypto tax in India is simple to state but easy to get wrong. This guide explains the rules that apply in FY 2026-27 in plain words. It is general information, not tax advice: for your own return, please speak to a chartered accountant (CA).

Short version: profit from selling or swapping crypto is taxed at a flat 30% (plus cess), a 1% TDS applies to many transfers, losses cannot be set off, and everything goes in Schedule VDA of your ITR. Budget 2026-27 (1 Feb 2026) kept these rules unchanged.

What counts as a "VDA"?

Indian tax law calls crypto a Virtual Digital Asset (VDA). Bitcoin, USDT, ETH, TRX and NFTs are all VDAs. From 1 April 2026 the new Income-tax Act, 2025 applies; the section numbers changed (earlier the main rules were Section 115BBH and Section 194S), but the substance of the VDA rules stayed the same.

1. 30% tax on profit

When you transfer a VDA (sell it for rupees, swap it for another coin, or spend it), the gain is taxed at a flat 30%, plus 4% health and education cess.

• Gain = sale value − cost of buying it. Only the cost of acquisition can be deducted.
• No other expenses can be deducted (not internet, device or exchange subscription costs).
• The 30% applies whatever your income slab is, even if your total income is below the basic exemption limit.

Example: you bought USDT for ₹50,000 and later sold it for ₹55,000. Gain = ₹5,000. Tax = 30% of ₹5,000 = ₹1,500, plus 4% cess = ₹1,560.

2. Losses cannot be set off

If you lose money on one coin, you cannot use that loss to reduce the tax on a profit from another coin, or from any other income. You also cannot carry the loss forward to later years.

3. 1% TDS on transfers

A 1% TDS is deducted when crypto is transferred, if your total transfers in the financial year cross ₹10,000 (or ₹50,000 for specified persons, such as some individuals without business income). Indian exchanges deduct it automatically.

• The TDS shows up in your Form 26AS / AIS.
• It is not an extra tax: you can claim it against your final tax when you file your ITR.

4. Gifts of crypto

Crypto received as a gift can be taxable in the receiver's hands if the total value of gifts in the year is above ₹50,000 (gifts from close relatives are exempt).

5. Does sending USDT between my own wallets count?

Moving USDT from your exchange account to your own self-custody wallet (like CoinExle Wallet), or between two of your own wallets, is not a sale. There is no gain, so there is no 30% tax on that move. The network fee you pay is not deductible.

Keep simple records anyway: date, amount, from and to addresses, and the transaction ID. It makes your CA's job much easier.

6. Where to report it

Report every VDA transfer in Schedule VDA of your Income Tax Return: date of buying, date of transfer, cost and sale value. Exchanges let you download a tax report; for on-chain transfers, your wallet history and Tronscan give you the transaction details.

Common mistakes

• Thinking USDT is "like rupees" and not taxable. Selling or swapping USDT at a gain is taxable like any VDA.
• Trying to reduce tax by setting off a loss on another coin: not allowed.
• Forgetting to claim the 1% TDS already deducted.
• Not keeping records of self-custody wallet transfers.

FAQ

Is crypto legal in India?

Buying, holding and selling crypto is not banned in India, but crypto is not legal tender. It is taxed under the VDA rules above.

Do I pay tax if I only hold crypto?

No. Tax applies when you transfer (sell, swap or spend) it, not while you simply hold it.

Is a swap from USDT to BTC taxable?

Yes. A swap is a transfer of the coin you give away, so any gain on it is taxed at 30%.

Does CoinExle deduct TDS?

No. CoinExle Wallet is a self-custody wallet, not an exchange, so it does not deduct TDS. You are responsible for reporting your own transfers.

This article is general information based on the rules as reported for FY 2026-27. Tax rules can change and every case is different. Please consult a chartered accountant before filing.