Crypto TDS Calculator
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On July 1, 2022, India introduced a 1% Tax Deducted at Source (TDS) on every crypto transaction - and it changed everything for everyday traders. If you’re buying, selling, or swapping Bitcoin, Ethereum, or any other digital asset in India, this rule applies to you. No exceptions. No gray areas. Just a flat 1% taken out before you even see your money. It’s not a capital gains tax. It’s not an income tax. It’s a 1% TDS - and it’s deducted at the moment the trade happens.
What exactly does the 1% TDS apply to?
The rule covers any transfer of a virtual digital asset (VDA), which includes Bitcoin, Ethereum, Solana, or any token classified under India’s tax law. That means:
- Selling Bitcoin for INR
- Trading Ethereum for Dogecoin
- Using crypto to pay for goods or services
But here’s what it doesn’t cover: moving crypto from your wallet to your exchange account, or between wallets you own. That’s just a transfer - not a sale or trade. So if you’re holding crypto and just shifting it around your own accounts, no TDS kicks in.
What makes this tricky is that both sides of a crypto-to-crypto trade pay TDS. If you trade 1 BTC for 20 ETH, you pay 1% TDS on the value of the BTC you gave up. The person you traded with pays 1% TDS on the value of the ETH they gave up. That’s 2% total taken out of the same transaction. For high-frequency traders, that adds up fast.
Who pays the 1%? And when does it kick in?
The TDS threshold depends on who you are.
If you’re a regular individual or Hindu Undivided Family (HUF) - and you’re not required to get your accounts audited - then TDS only applies if your total crypto transactions in a financial year (April 1 to March 31) exceed ₹50,000. That sounds generous, but it’s not. If you trade ₹10,000 every week, you hit ₹520,000 in a year. You’re over the limit. TDS applies to every single trade after that.
For everyone else - businesses, professionals, or individuals who are audited - the threshold is just ₹10,000 per year. That’s less than ₹1,000 a month. Even small, occasional trades trigger TDS.
And here’s the catch: the exchange or platform you use is legally required to deduct the 1% at the time of the transaction. So if you’re using CoinDCX, WazirX, or ZebPay, the TDS is taken automatically. You don’t get a choice. You don’t get a warning. It just happens.
What happens if you trade on P2P or international platforms?
This is where things get messy.
If you’re trading on a foreign exchange like Binance or using a P2P platform like LocalBitcoins, the platform doesn’t deduct TDS. That means you are legally responsible for calculating and paying it yourself. You need to:
- Track every transaction with timestamps and values in INR
- Collect the PAN of the person you traded with
- File Form 26QE monthly
- Issue a TDS certificate within 15 days
That’s a full-time job for a casual trader. Most people don’t do it. And the tax department knows. In 2024, the GST Network flagged over 1.2 million unreported P2P trades. Penalties for non-compliance can include fines, interest, and even criminal prosecution under Section 276C.
How does this stack up with other crypto taxes in India?
The 1% TDS isn’t the only tax. It’s just the first layer.
On top of that, you pay 30% tax on any profit you make from crypto - no deductions, no loss carryforwards. Even if you lost ₹5 lakh on one trade and made ₹8 lakh on another, you pay 30% on the ₹8 lakh. No offset. No relief.
Then there’s the 4% health and education cess on that 30% - so your effective tax rate on gains is 31.2%.
And now, as of July 1, 2025, exchanges are also charged 18% GST on their service fees. So if you pay ₹1,000 in trading fees on a ₹2,50,000 trade, you pay ₹180 in GST. Add that to the ₹2,500 TDS, and you’re out ₹2,680 before you even see your profit.
India is the only country that layers TDS, capital gains tax, and GST on crypto - all at once. No other major market does this.
Real impact: What’s happening to traders?
The numbers tell a clear story.
Before TDS, India had 15 million crypto users. By early 2025, that dropped to 11.7 million. That’s 2.3 million people who walked away - not because crypto failed, but because the tax burden became too heavy.
Day traders are hit hardest. One trader on Reddit calculated that doing 100 trades a month at ₹10,000 each means ₹10,000 in TDS taken out every year - 10% of his trading capital gone before he even makes a profit. He quit after six months.
Others are gaming the system. Splitting trades under ₹50,000. Using multiple wallets. Trading only on weekends to avoid exchange monitoring. One user told ClearTax he now uses three different exchange accounts just to stay under the threshold. It’s not illegal - but it’s not what the law intended.
And then there are the glitches. In late 2023, CoinSwitch Kuber’s system wrongly applied double TDS to over 15,000 transactions. Users got charged twice. Refunds took months. Many never got them back.
What about Form 26AS? Is it reliable?
Form 26AS is your official tax record. It shows all TDS deducted on your name. But here’s the problem: it’s slow. And messy.
Exchanges are supposed to report TDS to the tax department within 30 days of the end of each month. But it often takes 30 to 90 days for that to show up in your Form 26AS. That means if you’re filing your income tax return in July, your TDS credits might not be visible yet.
WazirX and ZebPay have built dashboards that show your cumulative TDS and remaining threshold - and users rate them 4.6/5. But if you’re using a lesser-known platform or trading P2P, you’re on your own.
What’s next? Changes coming in 2025-26
The government is listening - but not necessarily changing course.
The Finance Ministry received 142 stakeholder submissions asking to raise the ₹50,000 threshold to ₹1,00,000. A draft budget document from early 2025 suggests this change might happen. But nothing is confirmed yet.
The proposed Digital Asset Bill 2025 could replace TDS with a centralized transaction registry - where every trade is automatically reported to the tax department. That would make TDS redundant. But the bill is still in review.
Meanwhile, NPCI (the National Payments Corporation of India) is piloting a system that will auto-report crypto transactions through bank-linked accounts. By Q1 2026, your crypto trades might be flagged even if you don’t use an Indian exchange.
What should you do right now?
If you’re trading on Indian exchanges:
- Check your dashboard - it should show your annual TDS deducted and remaining threshold
- Wait 10 days after any trade to see if TDS appears in your Form 26AS
- Don’t panic if it’s delayed - it’s normal
If you’re trading on P2P or foreign platforms:
- Track every transaction in a spreadsheet - date, amount, INR value, counterparty PAN
- Calculate TDS on every trade - even if you didn’t get cash
- File Form 26QE every month - no exceptions
If you’re unsure, hire a tax professional. A basic crypto TDS compliance service costs ₹2,000-5,000 a year. That’s cheaper than a penalty.
And if you’re thinking of quitting crypto because of this - consider this: the tax is a cost of doing business in India. It’s not going away. The question isn’t whether you can avoid it. It’s whether you can manage it.
Is the 1% TDS on crypto in India a tax on profits?
No. The 1% TDS is not a tax on profits. It’s a deduction taken from the total value of every crypto trade - whether you made money, lost money, or broke even. Even if you sell Bitcoin at a loss, 1% is still deducted. The actual profit tax - 30% plus cess - is calculated separately when you file your income tax return.
Does the 1% TDS apply to crypto-to-crypto trades?
Yes. Every time you swap one cryptocurrency for another - like ETH for SOL - both parties pay 1% TDS. That means a total of 2% is deducted from the transaction. The exchange or platform handles this automatically if it’s an Indian platform. If you’re trading on a foreign exchange or P2P, you’re responsible for calculating and paying it yourself.
What’s the difference between the ₹10,000 and ₹50,000 TDS thresholds?
The ₹10,000 threshold applies to individuals and entities that are required to get their accounts audited - like businesses, freelancers with high income, or professionals. The ₹50,000 threshold applies to regular individuals or HUFs who are not audited. So if you’re a salaried employee with no business income, you get the higher limit. But if you’re self-employed and file audited returns, you’re stuck with ₹10,000 - meaning even small trades trigger TDS.
Can I avoid TDS by using a foreign exchange?
You can avoid automatic deduction, but not the legal obligation. If you trade on Binance, Kraken, or a P2P platform, the platform won’t deduct TDS. But under Indian law, you’re still required to calculate and pay it yourself. Failure to do so can lead to penalties, interest, or notices from the tax department. The Indian government now has access to data from global exchanges through international agreements, so avoiding detection is getting harder.
Why do I see TDS in my Form 26AS months after trading?
Exchanges have 30 days from the end of each month to file TDS details with the tax department. Then it takes another 2-3 weeks for the data to appear in your Form 26AS. So if you traded on June 15, you might not see the TDS reflected until August. This delay causes confusion during tax filing. Keep your own records - don’t rely on Form 26AS being up to date.
What happens if I don’t pay TDS on P2P trades?
You risk a tax notice, interest charges (1% per month), and penalties up to 200% of the unpaid TDS. In extreme cases, the tax department can freeze your bank accounts or initiate prosecution. In 2024, over 8,000 notices were issued to P2P traders for non-compliance. Most were settled with back payments and interest, but some led to legal action. Ignoring it is not an option.
Is there a way to reduce the impact of TDS on my crypto trading?
Yes - but only within the rules. Reduce the number of trades. Consolidate small transactions into fewer, larger ones to stay under the ₹50,000 threshold. Use platforms that show your TDS dashboard so you know how close you are to hitting the limit. Avoid trading on weekends if your platform has glitches. And never try to hide trades - the system is getting smarter. The goal isn’t to avoid tax - it’s to manage it smartly.
Comments
ashi chopra
November 30, 2025 AT 01:03 AMBro, I just sold 0.5 BTC last week and got hit with ₹1,200 TDS even though I broke even. No profit, no gain, just gone. And the exchange didn’t even notify me - it just vanished from my balance. I thought I was smart for using WazirX, but turns out I’m just another number in their ledger. This isn’t taxation, it’s financial harassment.