India Crypto Tax Calculator
Calculate your tax liability under India's unique crypto tax rules. With the No Loss Offset Rule, crypto losses cannot be used to reduce your tax on crypto gains. The calculator shows how much you'd owe in taxes and how the rules impact your net profit.
Imagine you make ₹100,000 trading Bitcoin but lose ₹80,000 on Ethereum in the same year. Under normal investing rules, you’d only pay tax on your net gain of ₹20,000. But in India, you still owe ₹30,000 in taxes-30% of that ₹100,000 profit-while the ₹80,000 loss disappears with no refund, no carry-forward, no relief. This isn’t a glitch. It’s the law.
What the No Loss Offset Rule Actually Means
Since April 2022, India has treated all Virtual Digital Assets (VDAs) like Bitcoin, Ethereum, and NFTs as a separate asset class with its own tax rules. Section 115BBH(2)(b) of the Income Tax Act says clearly: crypto losses cannot offset crypto gains. That’s it. No exceptions. No netting. No mercy. This isn’t just unusual-it’s extreme. In every other investment category in India, whether it’s stocks, mutual funds, or real estate, you can balance your wins and losses. If you lose money on one stock, you can use that loss to reduce the tax on another. Not with crypto. A loss on Solana doesn’t help you with a profit from Chainlink. A loss from selling an NFT doesn’t touch your Bitcoin gain. Each trade stands alone, taxed at 30% on its gross profit.How the Tax System Adds Insult to Injury
The no loss offset rule doesn’t work alone. It’s part of a larger system designed to extract tax at every turn.- 30% flat tax: No matter your income, no matter how long you held the asset, every crypto gain is taxed at 30%. Even if you’re in the 5% tax bracket for your salary, crypto profits are slapped with 30%.
- 1% TDS on every transfer: Since July 2022, every time you send crypto from one wallet to another-whether you’re selling, swapping, or gifting-if the value exceeds ₹10,000 in a year, the exchange automatically deducts 1%. This happens even if you’re losing money overall. You pay this upfront, and you can’t get it back later, even if your year ends in net loss.
- No expense deductions: You can’t deduct gas fees, exchange fees, or even the cost of using a tax software. Only the original purchase price counts. So if you bought ETH for ₹50,000, paid ₹200 in gas to swap it to SOL, and sold SOL for ₹55,000, your taxable gain is ₹5,000-not ₹4,800. The ₹200 is gone.
Real-Life Impact: Paying Tax on Money You Never Kept
Let’s say you trade actively. You make five trades in a month:- Trade 1: Buy BTC for ₹200,000 → Sell for ₹250,000 → Profit: ₹50,000
- Trade 2: Buy ETH for ₹150,000 → Sell for ₹100,000 → Loss: ₹50,000
- Trade 3: Buy ADA for ₹80,000 → Sell for ₹120,000 → Profit: ₹40,000
- Trade 4: Buy DOT for ₹60,000 → Sell for ₹40,000 → Loss: ₹20,000
- Trade 5: Buy SOL for ₹70,000 → Sell for ₹90,000 → Profit: ₹20,000
What Happens When You Lose Everything?
Losing crypto to a hack? A scam? A forgotten seed phrase? Too bad. The law doesn’t care. You can’t claim a tax deduction for stolen or lost crypto. The IRS in the U.S. lets you claim theft losses under certain conditions. India doesn’t. Even if you lose your entire portfolio, you still owe tax on every single profitable trade you made that year. And if you didn’t report those losses? The government can now tax your unreported crypto holdings at 60% retroactively, back to February 1, 2025. That’s not a penalty. That’s a financial trap.How Traders Are Adapting (and Why It’s Risky)
Some traders are trying to work around the system. One common workaround? Switching to crypto futures. Futures aren’t classified as VDAs under Indian law. That means no 30% tax, no 1% TDS, and yes-losses can offset gains. But here’s the catch: futures trading is high-risk, leveraged, and not legal for everyone. Many platforms don’t allow retail users to trade them. Plus, if you’re caught trading futures on unregulated platforms, you could face legal trouble. Others are moving to offshore exchanges. But if you send more than ₹7 lakh abroad in a year under the Liberalised Remittance Scheme, India imposes a 20% Tax Collected at Source (TCS) on the amount sent. So you’re avoiding one tax, only to get hit by another.Compliance Is a Full-Time Job
Filing taxes for crypto in India isn’t like filing for salary or dividends. You can’t use ITR-1. You need ITR-2 or ITR-3. And you must fill out Schedule VDA-a 10-page form that asks for every single transaction: date, asset, purchase price, sale price, exchange used, wallet addresses. If you made 50 trades in a year? You need 50 entries. Miss one? You risk a notice. Get one wrong? You could be flagged for evasion. Many traders now hire crypto tax specialists just to fill out the forms. Fees range from ₹5,000 to ₹25,000 per year.
How India Compares to the Rest of the World
Most countries treat crypto like any other investment. In the U.S., you can offset crypto losses against crypto gains. If you still have losses left, you can deduct up to ₹1.5 lakh ($1,500) against your salary and carry the rest forward for years. In Germany, if you hold crypto for more than a year, you pay zero tax. In Portugal, crypto gains are tax-free. In Singapore, there’s no capital gains tax at all. India is one of the only major economies that taxes every single profitable trade at 30%, blocks any loss relief, and adds a 1% tax on every transfer. It’s not just strict-it’s uniquely punitive.What This Means for the Future of Crypto in India
The result? Trading volumes on Indian exchanges have dropped. New users are hesitant. Long-term holders are staying put. Active traders are leaving or going underground. Tax experts warn that this system isn’t collecting more revenue-it’s driving compliance underground. The government thinks it’s getting 30% of every gain. But it’s missing the bigger picture: when traders stop reporting, they stop paying altogether. The no loss offset rule isn’t just a tax policy. It’s a signal: India doesn’t want you to trade crypto. It wants you to hold it-or not at all.What You Should Do Right Now
- Track every transaction: Use a crypto tax tool like Koinly or CoinTracker. Manual spreadsheets will fail you.
- Don’t ignore losses: Even if they don’t reduce your tax, you still need to report them. They might matter later if rules change.
- Know your TDS: Check your exchange statements. The 1% is taken automatically-don’t assume it’s optional.
- Don’t gamble on offshore: The 20% TCS on remittances makes it a losing game.
- Consult a crypto-savvy CA: This isn’t DIY territory anymore.
If you’re still trading, you’re already in the minority. The system isn’t designed to help you win. It’s designed to make you pay.
Can I use my crypto losses to reduce my salary tax in India?
No. Under Section 115BBH, crypto losses cannot be offset against any other income-salary, business, or capital gains from stocks or real estate. They are locked within the crypto category and cannot be used anywhere else.
Is there any way to carry forward crypto losses to next year in India?
No. Unlike stocks or business losses, which can be carried forward for up to eight years, crypto losses in India expire at the end of the financial year. There is no carry-forward provision. Once the year ends, the loss is gone.
What happens if I don’t report my crypto losses?
You won’t get in trouble for not reporting losses-but you might get in trouble for not reporting gains. The Income Tax Department tracks transactions through exchange data and TDS records. If you report profits but omit losses, it won’t help you. But if you report nothing at all, you risk a 60% tax assessment on unreported holdings under Section 158B, with penalties and interest.
Can I deduct gas fees or exchange fees from my crypto profits?
No. Only the original purchase cost of the crypto asset is allowed as a deduction. Transaction fees, gas fees, withdrawal charges, and software costs are not deductible under current rules. Your taxable gain is calculated on the full sale amount minus only the acquisition price.
Are staking rewards taxed differently than trading profits?
Yes. Staking rewards are treated as income when you receive them, not as capital gains. They’re taxed at your normal income tax slab rate, not the 30% flat rate. When you later sell those rewards, you pay 30% on the profit from their value at the time you received them.
Do I have to pay TDS on peer-to-peer crypto trades?
Yes. If you’re buying crypto directly from another person and the transaction value exceeds ₹10,000 in a year, the buyer is legally required to deduct 1% TDS and deposit it with the government. If they don’t, you could be held responsible. This makes P2P trading riskier and more complex than using regulated exchanges.
3 Responses
This is wild. I trade crypto in the US and I can’t believe India taxes every single profit like this. No loss offset? No carry-forward? That’s not tax policy-that’s punishment. I feel bad for traders there. 💔
This is why crypto is a scam!! People think they’re ‘investing’-no, they’re gambling with tax bombs!! If you can’t handle losses, don’t trade!! India’s rules are PERFECT-stop crying and pay your dues!!
So let me get this straight-you’re taxed on gross profits while ignoring the actual net outcome? That’s not economics, that’s a mathematical paradox. It’s like taxing you for every time you spilled coffee, even if you spilled more than you drank. Why does this exist??