Tax filing for crypto investors: All you need to know

economictimes.indiatimes.com:

ITR) in India approaches (July 31), it is crucial to address specific concerns around taxation on investments in crypto and other virtual digital assets (VDA), including NFTs. Navigating the tax landscape can look complex but with the right knowledge and guidance, you can ensure a smooth and compliant filing process.Gist of crypto taxation VDA transactions, including sales, are subject to a 30% capital gains tax in India. A capital loss in one VDA can’t be offset against profit in another– essentially, you pay 30% capital gains on profitable assets of that financial year. Additionally, a 1% Tax Deducted at Source (TDS) is also charged on VDA sale/transfer between assets. These are deposited to your PAN number by compliant Indian exchanges which you can use to reduce your tax liability or get a refund via your ITR filing.Key pointersTo help you in this tax filing season, we enlist some additional pointers for preparing your ITR.

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Understand taxable events: Selling VDAs for fiat currency, trading one VDA for another, using VDAs to make purchases, airdrops and forks, all of these events are considered tax liabilities that need to be reported in your ITR. Gifting and donating VDAs that cost less than ₹50,000 are exempt from taxes.Determine your tax liability: To calculate your tax liability, you need to accurately tally your profit/loss in each VDA you have invested/traded in. You will have to pay a 30% tax