Bitcoin gains? Here’s exactly how Indian investors must file and pay tax in 2025

As Bitcoin touched a new all-time high of $116,906.22 this week — valued at over ₹1 crore in India — the spotlight is back not just on its meteoric returns but on the strict tax regime that now governs crypto in the country.

With Bitcoin now trading at over ₹1,00,36,400 per coin (based on the latest USD-INR exchange rate of ₹85.85), many investors are staring at massive gains. But along with those gains comes a heavy tax burden under India’s Virtual Digital Asset (VDA) framework.

Since 2022, profits from selling or transferring Bitcoin are taxed at a flat 30%, plus 4% cess, regardless of your income level. That means no slab benefits and no exemptions—except for the cost of acquisition, which is the only deductible allowed.

Additionally, a 1% TDS (Tax Deducted at Source) is levied by crypto exchanges on every sale or trade over ₹10,000 annually (₹50,000 in some cases), making crypto one of the most tightly taxed asset classes in India.

How to file it:

• If you’re an investor, file under ITR-2. If you’re trading crypto as a business, use ITR-3.
• Both forms include a mandatory Schedule VDA section. You must declare:
• Date of purchase and sale
• Sale amount
• Cost of acquisition
• Net profit (auto-calculated)

You’ll also need to verify your Form 26AS or exchange records to ensure the 1% TDS has been deducted correctly. Any shortfall must be paid before submission.

No loopholes:
Losses from Bitcoin or other VDAs cannot be set off against other income or carried forward to future years. Gifting Bitcoin? That’s taxable in the recipient’s hands.

Fail to comply?
Non-disclosure can trigger 60% punitive tax, interest, and potential prosecution. The government has made it clear: crypto is under full regulatory watch, and tax evasion won’t be tolerated.

Bitcoin may be booming, but with India’s VDA tax rules in full force, so is compliance. Enjoy the rally—but report every rupee.