Taxation on Income from Crypto/Crypto currency
PrintListen to this Article
Taxation on Income from Virtual Digital Assets i.e. Crypto/ Crypto Currency (Effective for the AY 2023-24)
These are specific sections i.e., 2(47A), 115BBH, & 194S are proposed to be inserted under Income-tax Act by Finance bill 2022-23 to tackle the taxation issues relating to the transactions of Virtual Digital Assets (VDA) i.e., Crypto Currencies. Summary of the proposed taxation on the Crypto currencies are as under:
1) Income: Any income from transfer of any VDA i.e., Crypto shall be taxed @ 30%.
2) Expenditure: No deduction in respect of any expenditure or allowance shall be allowed while computing such income except cost of acquisition.
3) Set off and carry forward of loss: No loss from transfer of virtual digital asset cannot be set off or carry forward and set off against any other income.
4) TDS: TDS on payment made in relation to transfer of VDA @ 1% of such consideration above a monetary threshold i.e., 50,000/10,000.
i) Monetary limit: Monetary limit are as under:
(a) In case of Specified Person: Consideration payable not exceeds 50,000 during the financial year.
(b) In case of Other than Specified Person: Consideration payable not exceeds 10,000 during the financial year.
ii) Specified Person: Defined as under:
(a) Individual/FUF whose:
 Business- Total sale or turnover from the business carried by him not exceed by One Crore rupees
 Profession- Gross receipt from the Profession carried by him not exceed by Fifty Lakhs rupees
 Other than Business/Profession- No income under the head of ‘Profit and gain of business or profession’ during the financial year immediately preceding the financial year in which such VAD is transferred.
5) Gift of VDA: Gift of VDA is also proposed to be taxed in the hands of the recipient under the head of ‘Income from Other Sources’.
6) Property or Currency: It is also clarified that VDA i.e., Crypto Currencies are just Asset/Property and not the Indian/ Foreign Currency.
Vijay Kumar Gupta CA, CS, LLM, M.Com, LL.B, B.Com, FAFD(ICAI) cavgindia@gmail.com
Category : Income Tax | Comments : 0 | Hits : 1728
Income Tax Alert - Here Are 5 High-Value Transactions That May Come Under Scrutiny. Large Cash Deposits: Any cash deposit exceeding Rs 10 lakh in a financial year across savings accounts draws the attention of the income tax department. Even if deposits are spread across multiple accounts, the cumulative amount beyond the threshold triggers scrutiny. Fixed Deposits: Surpassing the Rs 10-lakh limit in fixed deposits within a financial year prompts inquiries regarding the source of f...
Delhi Court Sentences Woman to 6 months Jail for not filing the return of income (ITR) discussed. Accordingly, the accused is held guilty of not filing the return of income for the assessment year 2014-15 under Section 276CC of The Act. Accordingly, the accused is convicted for an offence punishable under Section 276CC of the Act," the court said in the judgement. "The convict is awarded a sentence of simple imprisonment for six months with a fine of Rs 5,000 and in default to unde...
Corporates, Non-corporates or government department all are procuring major part of services or goods from the MSMEs. There are provision under the Micro, Small, and Medium Enterprises Development (MSMED) Act, to ensure that businesses make payments to MSMEs within a specified time frame, and failure to which can impact the deduction claims for such payments. To facilitate timely payments to micro, small, and medium enterprises (MSMEs) and address the challenges faced by these businesses in rec...
In the Income tax act, the words “Turnover”, “Gross receipts” and Sales are used at many places. In the common business parlance, the terms sales and turnover are used interchangeably. However, as per Income Tax law, guidelines are available on the question of what constitutes turnover. Understanding the concepts of these words is necessary for the purpose of the tax audit. An audit is mandatory for corporate assessees, irrespective of the amount of turnover. In ...
Very Important Income Tax Update regarding Micro and Small Enterprises Section 43B-any amount remains unpaid on year end to creditors, being micro/small entity, beyond 45 days or less, as agreed or 15 days if no agmt, shall be added to taxable Income resulting in huge additional tax liability. Keeping such creditors unpaid is risky. If payment for purchases made from *Micro and Small units* remains outstanding on 31st March, there may be huge tax liability. Therefore...
Comments