Cryptocurrency – Very important news for Indian investors about cryptocurrency.
Cryptocurrency – Very important news for Indian investors about cryptocurrency. Indians have invested billions of dollars in cryptocurrencies like Bitcoin, Dogecoin, Ethereum, Binance, Ripple, Matic and other popular coins. The trading volume of cryptocurrencies has increased manifold since last year’s nationwide lockdown. According to a recent report by Bloomberg, Indian investments in cryptocurrencies increased from $923 million in April 2020 to around $6.6 billion in May 2021. The surprising thing is that this investment in crypto by Indians has increased despite there is no clear regulation on this from RBI or the government.
Increase in the number of investors in lockdown
RBI had tried to impose a restriction in 2018 by restricting banking facilities to crypto exchanges, which was later rejected by the Supreme Court. Since then, Indian engagement in crypto trading and investing has grown manifold, especially after the Covid-induced lockdown has confined salaried youth to their homes, leaving them to explore new ways to make money fast. Got enough time for it.
Now the income tax department will ask for details
The Income Tax Department has asked for the details of those transacting from cryptocurrency exchanges. According to sources, the department is keeping an eye on people making huge profits from trading cryptocurrencies. The department suspects that the trading people are hiding their real income. In the income tax notice to the cryptocurrency exchange, all the details of the traders have been asked. The IT department has asked for a complete record of the transactions of Coins. The IT department is keeping an eye on those who make profits in cryptocurrency trading. There is a possibility of tax evasion by earning the department. Many cryptos, including bitcoin, have gained momentum over the past year. WazirX, CoinDCX, Zebpay, UnoCoin are the top cryptocurrency exchanges. The IT department has sent a notice to them.
Information should be given to the Income Tax Department
As the tax filing season for AY 2021-22 begins, many crypto investors in the country may be worried about the tax implications of their earnings from crypto-digital trading and investments in the previous financial year. The Income Tax Department has not yet given any clarification regarding the effect of tax on profits earned from crypto transactions. According to Archit Gupta, Founder and CEO, Clear, even though cryptocurrencies are yet to be legalized by the Reserve Bank of India (RBI), it is not advisable to avoid paying income tax on its gains.
How to pay tax on crypto transactions?
As per normal income tax, profit on crypto-transactions will become taxable as business income or capital gain, depending on the nature of these transactions and the intention of the investor, says Experts. “Profits from crypto transactions will be taxed as ‘business income’. If trades are frequent and volumes are high, then it is taxed as ‘capital gains’. According to experts, every taxpayer For this it should be reviewed and the taxpayers should take the help of an expert.
India will launch its own digital currency
Reserve Bank of India (RBI) Deputy Governor T Ravi Shankar (T. Rabi Sankar) said on Thursday that the RBI is working on a strategy to implement its own digital currency in a phased manner. And is in the process of introducing it on a pilot basis in the wholesale and retail sectors.
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