India Crypto Tax Calculator
Calculate Your Tax Liability
Determine your tax obligations when trading crypto in India
India doesn’t ban cryptocurrency. But if you think that means you can trade crypto however you want, you’re setting yourself up for trouble. The rules aren’t about stopping you-they’re about tracking you. And if you ignore them, the penalties can be harsh: fines, frozen accounts, or even tax notices that demand years of back payments. The goal isn’t to avoid restrictions. It’s to work within them so you don’t get caught in them.
Understand What’s Actually Allowed
Cryptocurrencies like Bitcoin, Ethereum, and NFTs are legal to buy, hold, and trade in India. There’s no law saying you can’t own them. But they’re not legal tender. You can’t use Bitcoin to pay for groceries at a local store. The government treats them as virtual digital assets (VDAs), which means they’re taxed like property, not currency. The Supreme Court cleared the way for crypto in 2020 when it struck down the RBI’s ban on banks serving crypto exchanges. Since then, the rules have been built around taxation and tracking-not prohibition. The real restriction isn’t on ownership. It’s on anonymity.Pay the 30% Tax-No Exceptions
Every time you sell crypto for rupees, trade one coin for another, or even gift it, you trigger a taxable event. The tax rate? A flat 30%. No deductions. No losses offset. Even if you lost money on other trades, you still pay 30% on every profit. Here’s how it works: If you bought 0.1 BTC for ₹3,00,000 and sold it for ₹5,00,000, your gain is ₹2,00,000. You owe ₹60,000 in tax. That’s it. No exemptions. No loopholes. The government doesn’t care if you’re a day trader or a long-term holder. Profit equals tax.Watch Out for the 1% TDS
On top of the 30% tax, there’s a 1% Tax Deducted at Source (TDS) on every crypto transaction. That means if you sell ₹1,00,000 worth of Ethereum, ₹1,000 gets taken out before you even see the money. This isn’t your final tax-it’s an advance payment. You’ll get credit for it when you file your annual return. The catch? This applies to every trade, even crypto-to-crypto swaps. So if you trade Bitcoin for Solana, the exchange deducts 1% of the value of the Bitcoin you sold. Many users miss this because it’s automatic. But if you use a non-compliant exchange, TDS won’t be deducted-and that’s a red flag for the tax department.Only Use FIU-IND Registered Exchanges
The Financial Intelligence Unit India (FIU-IND) is the watchdog for anti-money laundering. If you want to trade legally, you must use exchanges that are registered with them. As of 2025, over 50 exchanges are registered, including WazirX, CoinDCX, Zebpay, and even Binance and Coinbase after they adapted their systems for India. Why does this matter? Registered exchanges automatically collect your KYC documents, report your trades to the tax department, and deduct TDS. They also keep records for six years-exactly what the law requires. If you use an unregistered platform like BingX or LBank (both shut down in India for non-compliance), you’re on your own. No TDS. No reports. No protection. And if the tax department audits you, you’ll have no proof of where your money came from.
Keep Perfect Records-Or Face the Consequences
You’re legally required to keep records of every crypto transaction for six years. That includes:- Date and time of each trade
- Amount bought or sold
- Price in INR at the time
- Wallet addresses involved
- Purpose of the transaction (e.g., investment, gift, payment)
Don’t Try to Hide or Circumvent
Some users think they can avoid taxes by using peer-to-peer (P2P) platforms, offshore exchanges, or crypto mixers. That’s a dangerous myth. The government already has data-sharing agreements with major global exchanges. If you bought crypto on Binance or Coinbase and transferred it to your Indian wallet, they report it. P2P trades? FIU-IND monitors transaction patterns. If you’re moving large sums without KYC, you’ll get flagged. Crypto mixers? Illegal under Indian AML rules. Even if you think you’re just protecting privacy, the law sees it as an attempt to obscure the trail. The penalty? Up to ₹10 lakh in fines and possible criminal charges.What Happens If You Get Audited?
If you’re selected for a crypto audit, the Income Tax Department will ask for:- Details of all crypto transactions in the last six years
- Proof of purchase price and sale price
- Bank statements showing crypto deposits and withdrawals
- Exchange statements from registered platforms
Real People, Real Results
Crypto traders on Reddit and Indian forums consistently say the same thing: those who stay compliant never get trouble. One user in Mumbai traded crypto for three years, paid all taxes, and filed returns with proper documentation. When audited, he was cleared in two weeks. Another trader in Bangalore used an unregistered exchange, didn’t report gains, and got a ₹4.2 lakh tax notice last year. He had to sell his car to pay it. The message is clear: compliance isn’t a hassle. It’s your shield.Where to Start
If you’re new to crypto in India:- Sign up on a FIU-IND registered exchange (WazirX, CoinDCX, Zebpay)
- Complete full KYC
- Use only that exchange for all trades
- Enable TDS reporting
- Export your trade history every month
- Use free crypto tax tools to calculate gains
- File your income tax return with Schedule VDA
The Future Isn’t About Avoiding Rules-It’s About Mastering Them
India isn’t moving toward banning crypto. It’s moving toward tighter control. The government is working with global bodies like the FSB and G20 to align with international standards. More reporting, more transparency, more automation. The future belongs to those who adapt-not those who resist. Your best move isn’t to find ways around the system. It’s to build your crypto strategy inside it. Use registered platforms. Pay your taxes. Keep your records. That’s not avoiding restrictions. That’s thriving within them.Is it legal to buy Bitcoin in India?
Yes, buying Bitcoin and other cryptocurrencies is legal in India. They are classified as virtual digital assets (VDAs) under the Income Tax Act. You can hold, trade, and sell them as long as you comply with tax and reporting rules.
What happens if I don’t pay crypto tax in India?
If you don’t report crypto gains, the Income Tax Department can audit you. Penalties include up to 200% of the unpaid tax, interest charges, and possible freezing of bank accounts. In serious cases, criminal proceedings may be initiated for tax evasion.
Can I use Binance or Coinbase in India?
Yes, both Binance and Coinbase are registered with FIU-IND and operate legally in India. They comply with KYC, TDS, and AML rules. Avoid unregistered versions of these platforms-only use their India-specific websites.
Do I pay tax on crypto-to-crypto trades?
Yes. Trading Bitcoin for Ethereum or any other crypto is treated as a taxable event. You must calculate the INR value of the asset you sold and pay 30% tax on the gain. TDS is also deducted at 1% on the transaction value.
How do I prove my crypto purchases for tax purposes?
Use transaction history from FIU-IND registered exchanges, which include timestamps, prices in INR, and wallet addresses. Keep bank statements showing deposits to these exchanges. Never rely on screenshots or unverified records-official exchange reports are required during audits.
Is crypto mining legal in India?
Mining is not explicitly banned, but it’s treated as a business activity. Any income from mining is taxable at 30%. You must report it as business income and pay GST on electricity and equipment purchases. Most miners use registered exchanges to sell their coins and report earnings accordingly.
Can I gift crypto to family members?
Yes, but the giver must pay 30% tax on the fair market value of the crypto at the time of transfer. The receiver doesn’t pay tax immediately, but if they later sell it, they’ll pay tax on the gain from the original purchase price-not the gift value.
