Crypto
8 months ago
Hi,
I wanted to ask about crypto. If i recieve my salary in crypto. And sell it at same price or in loss, still i have to pay 30% tax? Or i should file taxes in normal slab rates 1% tds also get deducted at the time of selling.
A.Dear client,
In India, the taxation of cryptocurrency transactions depends on various factors, including the nature of the transaction, the holding period, and the individual's total income. If you receive your salary in cryptocurrency, it is still considered a form of income and is subject to taxation.
When you sell the cryptocurrency received as salary at the same price or at a loss, it could still be considered a taxable event. The tax implications will depend on whether it is classified as short-term capital gains (STCG) or long-term capital gains (LTCG).
If the holding period of the cryptocurrency is less than 36 months (3 years), any gains from its sale would be treated as short-term capital gains. Short-term capital gains are added to your total income and are taxed at the applicable income tax slab rates, which could be up to 30% depending on your total income.
On the other hand, if the holding period is 36 months or more, the gains from selling the cryptocurrency would be classified as long-term capital gains. LTCG on cryptocurrencies are taxed at a flat rate of 20% after indexation benefit.
Additionally, at the time of selling the cryptocurrency, 1% Tax Deducted at Source (TDS) is applicable if the sale value exceeds Rs. 10 lakh.
It's essential to maintain accurate records of your cryptocurrency transactions, including the acquisition cost and sale proceeds, to calculate the gains accurately for tax purposes. Failing to report cryptocurrency income or gains accurately could lead to penalties and legal consequences.
In India, the taxation of cryptocurrency transactions depends on various factors, including the nature of the transaction, the holding period, and the individual's total income. If you receive your salary in cryptocurrency, it is still considered a form of income and is subject to taxation.
When you sell the cryptocurrency received as salary at the same price or at a loss, it could still be considered a taxable event. The tax implications will depend on whether it is classified as short-term capital gains (STCG) or long-term capital gains (LTCG).
If the holding period of the cryptocurrency is less than 36 months (3 years), any gains from its sale would be treated as short-term capital gains. Short-term capital gains are added to your total income and are taxed at the applicable income tax slab rates, which could be up to 30% depending on your total income.
On the other hand, if the holding period is 36 months or more, the gains from selling the cryptocurrency would be classified as long-term capital gains. LTCG on cryptocurrencies are taxed at a flat rate of 20% after indexation benefit.
Additionally, at the time of selling the cryptocurrency, 1% Tax Deducted at Source (TDS) is applicable if the sale value exceeds Rs. 10 lakh.
It's essential to maintain accurate records of your cryptocurrency transactions, including the acquisition cost and sale proceeds, to calculate the gains accurately for tax purposes. Failing to report cryptocurrency income or gains accurately could lead to penalties and legal consequences.
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