Indian Government imposed 30% Tax on profit and 1% TDS on cryptocurrency exchanges trading. TAX will be applicable on profit earns from crypto trading and TDS will be applicable on all transactions.
These basic TDS deductions are as follow:
- Crypto to Crypto Transaction transaction.
- Crypto to INR.
- P2P withdrawal.
All crypto deposit from Indian banks on Indian cryptocurrency exchanges are tax free.
Tips To Bypass Crypto Tax in India.
TDS Impact on Indian Cryptocurrency Exchanges
The Government of India and the Income Tax Department have given clear instructions to the Indian Cryptocurrency Exchange that now they will have to record their transaction data for 5 years.
Simultaneously, Indian exchanges have also been instructed to deduct one percent TDS on all cryptocurrency transactions. If your cryptocurrency TDS is 50000 or more continuously for 2 years and you do not file your income tax return then you may have to pay a penalty of up to 5 times.
That’s why being an honest citizen, you need to file your income tax return regularly.
If you trade your ₹ 100000 on any Indian exchange 20 times, then you will have to deduct 20% TDS which will be deposited on your PAN card. This means your 20,000 will be deducted from 1 lakh because of TDS.
This news is not good for those who trade in cryptocurrencies and their concern is also being seen in the crypto market.
Crypto Market Going Down Very Badly
Ever since the Government of India has announced the imposition of 30% tax and 1% TDS on cryptocurrency, the crypto market has been falling continuously since then.
The main reason for which is that the desire among the people for cryptocurrency is decreasing somewhere.
People are buying less, due to which the demand is falling and due to the cut in demand, the value of all the major cryptocurrencies is falling drastically.
The market cap of cryptocurrencies has come down to less than $1T ever since cryptocurrencies are taxed at 30% and 1% TDS in India.
TDS Impact: Crypto Trading Reduced By 87%
Due to the continuous fall in the market, people are withdrawing their funds. All the people who trade in cryptocurrencies on the Indian exchange are leaving their funds as they are or even making withdrawal in their banks.
From 1st July 2022, all Indian team has started deducting one percent TDS due to which the trading has come down by almost 87%.
People Adopting Alternative Markets Like Stock And Forex
Till a few days ago there was such a stir that everyone was investing money in crypto currency but the step taken by the government changed everything.
Due to the fear of tax on profits and TDS on transactions, everyone is leaving the cryptocurrency market and going to another market for their future.
Earlier people used to do crypto transaction for reducing tax. But now people insights have changed.
People are avoiding crypto payments and transaction for simplifying their tax and life.
TDS Impact: People Escaping From Fraud
People had made a business of cheating in the name of crypto currency, everyone was looting people’s money by launching a new cryptocurrency. India is a very big market as well as there is no awareness among people about cryptocurrency.
Taking advantage of the gentleness of the Indian people, foreigners were looting here through cryptocurrency.
Ever since the Indian government has imposed 30% tax on profits of cryptocurrency and 1% TDS on trading, all the fraudsters have disappeared. And people’s money has become safe.
TDS Impact: Investors Learning New Lessons
You must have seen around you that many people have become rich by investing money in cryptocurrency and then they became poor night by night. The reason behind this is that people simply invest money without any basic understanding.
And are facing the brunt of that but you guys are getting the wisdom. Ever since the threat of tax has loomed on your pocket, you have started investing your money consciously and you will soon see good results from it. Thank you.
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