Question 1

Can I offset a crypto loss against a gain on a different coin?

Accepted Answer

No. Section 115BBH bars any set-off of a loss from transfer of a virtual digital asset (VDA) against income computed under any other provision of the Act, and that loss cannot be carried forward to future years. This applies even between two different VDAs — a loss on one coin cannot reduce the tax on a gain on another. It is the most commonly misreported part of India's crypto tax regime. (Sources: Income-tax Act, 1961, s. 115BBH(2).)

Question 2

What tax rate applies to crypto gains in India?

Accepted Answer

Section 115BBH imposes a flat 30% tax on income from the transfer of any virtual digital asset (VDA), regardless of your income slab or how long you held it. No deduction is allowed for any expenditure or allowance except the cost of acquisition — transaction fees, internet costs, and other overheads cannot be deducted. (Sources: Income-tax Act, 1961, s. 115BBH(1)-(2).)

Question 3

What counts as a "virtual digital asset" under Indian law?

Accepted Answer

Section 2(47A) defines a VDA broadly: any information, code, number, or token generated through cryptographic or other means that provides a digital representation of value and can be transferred, stored, or traded electronically, plus non-fungible tokens and any other digital asset the government notifies by gazette. It excludes Indian and foreign currency. (Sources: Income-tax Act, 1961, s. 2(47A).)

Question 4

Is there a TDS on crypto transactions?

Accepted Answer

Yes. Section 194S requires whoever pays consideration for a VDA transfer to a resident to deduct 1% tax at source, at the time of credit or payment, whichever is earlier. The obligation is waived only below annual thresholds — ₹50,000 for 'specified persons' (lower-turnover individuals/HUFs) and ₹10,000 for everyone else — and CBDT Circular No. 13 of 2022 sets out how it applies to Exchange-routed trades. (Sources: Income-tax Act, 1961, s. 194S; CBDT Circular No. 13 of 2022.)

Question 5

Are NFTs taxed the same as crypto in India?

Accepted Answer

Generally yes. Notification 75/2022 specifies that a token qualifying as a VDA is treated as a non-fungible token — and therefore taxed under s.115BBH — unless the NFT's transfer conveys legally enforceable ownership of an underlying tangible asset, in which case it falls outside the notified NFT category. (Sources: CBDT Notification No. 75 of 2022.)

Question 6

Are gift cards or loyalty points taxed as crypto?

Accepted Answer

No. Notification 74/2022 expressly excludes gift cards and vouchers, mileage/reward/loyalty points, and subscriptions to websites, platforms, or applications from the definition of a virtual digital asset, so the 30% VDA tax regime does not apply to them. (Sources: CBDT Notification No. 74 of 2022.)

India: flat 30% VDA tax, no loss set-off between coins, plus 1% TDS on transfers.