Finance Minister Nirmala Sitharaman announced 1% TDS To Be Charged On Cryptocurrency Transactions From July 1
A TDS deduction on all virtual digital asset transactions of 1 % was announced in Union Budget 2022 - 2023 by Finance Minister Nirmala Sitharaman
After announcing a 30 % tax on crypto payments in India 2022 - 2023 in Union Budget. Cryptocurrency transactions are set to attract extra tax deducted at a source of 1 % starting from 1 July 2022
VDA is defined as any information code, number, or token except Indian or any other foreign currency that is generated through cryptographic or other means NFT or any other related token are included in this act.
The Central Board of Direct Taxes (CBDT) announced that the onus of holding the TDS lies with the person making the payment to the seller. This implies that the TDS needs to be deducted from the selling price and after deducting the TDS amount and the test can be paid or transferred to the seller.
For the transfer of VDA in exchange for kind, the buyer will be required to release the consideration in kind after the seller provides proof of payment of tax for VDA for VDA transactions for the buyer and the seller need to pay tax concerning the transfer of VDA and show the proof to each other so that VDA's can be exchanged The transaction will then have to be reported in the TDS statement along with the challan number by filling up Form 26Q
Related: Indian Crypto Exchange CoinDCX Extends Withdrawal Restrictions to Meet Compliance Requirements