Crypto Tax Calculator for India
Calculate your tax liability on cryptocurrency transactions in India based on the current tax structure. The Indian government imposes a flat 30% tax on crypto profits plus a 1% Tax Deducted at Source (TDS) on all transactions.
Note: India imposes one of the world's highest crypto tax rates. The 30% tax on profits plus 1% TDS (Tax Deducted at Source) means your effective tax rate can exceed 31% - significantly higher than most major economies.
Before March 2020, if you tried to buy Bitcoin in India, your bank could block your transaction. Not because it was illegal - but because the Reserve Bank of India told banks they couldn’t touch anything related to cryptocurrency. That changed forever when the Supreme Court of India struck down the ban. It wasn’t just a legal win. It was a recognition that people have the right to trade digital assets, even if the government doesn’t fully understand them yet.
What the Supreme Court Actually Did
The court didn’t legalize cryptocurrency. It didn’t create rules. It didn’t say Bitcoin is money. What it did was simpler and more powerful: it said the RBI’s 2018 ban was unconstitutional. The central bank had ordered all banks and financial institutions to cut off services to crypto exchanges - no deposits, no withdrawals, no trading accounts. That effectively shut down the entire industry overnight. Thousands of Indian crypto users lost access to their money. Exchanges like WazirX and CoinDCX were forced to pause operations. The Supreme Court called this move disproportionate. There was no law banning crypto. No evidence of systemic financial harm. Just fear. And the court ruled that fear isn’t enough to strip people of their right to conduct business. The judgment made it legal again for banks to work with crypto companies. Trading resumed. New users flooded in. Within months, user growth on major exchanges jumped by 300% to 400%.Why This Was a Landmark
Most countries handle crypto through legislation - laws passed by Parliament. The U.S. uses agency enforcement. The EU passed MiCA. India? The Supreme Court stepped in because the government refused to act. That’s rare. It’s the judiciary saying: “You can’t just ban something because you don’t like it.” This decision didn’t come from a technical analysis of blockchain. It came from constitutional law. The court applied the principle of proportionality: if a government action harms a large group of people, it must have a strong, specific reason. The RBI had none. The court saw crypto as a financial tool, not a threat - at least not one that justified a total shutdown.What’s Still Not Legal
Just because trading is allowed doesn’t mean crypto is regulated. India still has no clear law defining what cryptocurrency is. Is it property? A commodity? Currency? The government has no answer. That creates chaos. Exchanges follow RBI guidelines, but those are vague. Tax rules are harsh. And no one knows how to handle DeFi, NFTs, or cross-border transfers legally. The biggest issue? Taxes. India charges a flat 30% on every profit from crypto trades - no deductions, no losses offset. Plus, there’s a 1% tax deducted at source (TDS) on every single transaction, even if you’re just swapping one coin for another. That’s higher than any other major economy. For someone trading $1,000 a week, that’s $10 gone before they even see a profit. Many traders say it’s designed to discourage activity, not regulate it.
How People Are Adapting
Indian crypto users aren’t waiting for clarity. They’re adapting. Most serious traders now use accounting software to track every trade, calculate gains, and file taxes manually. Some hire chartered accountants who specialize in crypto - a niche service that barely existed five years ago. KYC is now standard on all exchanges. You need your ID, address proof, and PAN card to trade. But the gray areas are growing. What if you earn crypto from a DeFi protocol? Do you pay tax when you stake it? When you withdraw? What if you use a peer-to-peer app like LocalBitcoins? The tax department hasn’t said. The Supreme Court hasn’t said. The government hasn’t said. So people guess. And guess wrong. Many end up facing audits or penalties.What the Government Is Doing (or Not Doing)
The government has been silent since 2021. The Cryptocurrency and Regulation of Official Digital Currency Bill was introduced that year. It proposed banning private cryptocurrencies and launching a digital rupee. Nothing happened. No vote. No debate. No update. In October 2025, the Supreme Court called out the government directly. During a hearing on a crypto fraud case, Justices Surya Kant and N. Kotiswar Singh said the state was turning a “blind eye” to a growing financial sector. They warned that unregulated crypto could become a tool for money laundering - comparing it to Hawala, the informal underground banking system. But they also said outright bans are outdated. The message was clear: regulate, don’t ignore.
Where India Stands Today
India has an estimated 15 to 20 million crypto users - among the highest in the world. The market is worth over $6 billion. But it’s not growing like it could. Startups that once dreamed of building blockchain products in India are moving to Dubai, Singapore, or Portugal. Why? Because those places have clear rules. Investors know what’s allowed. Tax rates are lower. Legal risk is minimal. India’s strength? A massive, tech-savvy population. Its weakness? A government afraid to make decisions. The Supreme Court gave the country breathing room. But without legislation, that room is shrinking. Every new tax rule, every audit, every bank freeze adds pressure. People are trading. But they’re not innovating.What’s Next?
The next big moment will come when Parliament finally acts. Until then, the Supreme Court remains the only protector of crypto rights in India. The court has made it clear: you can trade. You can own. You can transfer. But you’re on your own when it comes to taxes, compliance, and legal risk. Experts say the government has two choices: either create a balanced framework - like the EU’s MiCA - or accept that crypto will keep growing in the shadows. The court won’t wait forever. If the government doesn’t act, the court might be forced to step in again. And next time, it might not be about banking access. It could be about whether crypto is legal property. Or whether the 30% tax violates constitutional rights. For now, the message is simple: trading crypto in India is legal. But it’s not safe. It’s not simple. And it’s not without risk. The Supreme Court opened the door. Now, the government has to decide whether to walk through it - or leave everyone standing in the cold.Is cryptocurrency legal in India after the Supreme Court ruling?
Yes, trading and owning cryptocurrency is legal in India. The Supreme Court’s 2020 ruling struck down the Reserve Bank of India’s ban on banks serving crypto businesses. That means you can buy, sell, and hold digital assets. However, there is still no specific law defining crypto as legal tender or property. The government has not passed any legislation to regulate it, leaving the legal status in a gray zone.
What are the tax rules for crypto in India?
India imposes a flat 30% tax on all profits from cryptocurrency trades, regardless of how long you held the asset. There are no deductions for losses. In addition, a 1% Tax Deducted at Source (TDS) applies to every transaction above a certain threshold - even when you swap one coin for another. This makes India one of the most heavily taxed crypto markets in the world. You must report all gains in your annual income tax return using Form ITR-2.
Can banks still block crypto transactions?
No. After the Supreme Court’s 2020 ruling, banks are no longer allowed to refuse services to crypto exchanges or users. They can’t block deposits or withdrawals related to cryptocurrency. However, some banks still apply vague “risk-based” policies that slow down or delay transfers. Users report occasional holds on accounts, but these are not legal under the court’s decision and can be challenged.
What happens if I don’t pay crypto taxes in India?
If you don’t report crypto gains or pay the 30% tax, you risk an income tax audit. The Indian tax department now receives transaction data from exchanges and can cross-check your returns. Penalties can include fines of up to 200% of the unpaid tax, interest charges, and in extreme cases, prosecution for tax evasion. The 1% TDS is automatically deducted, so that part is harder to avoid - but undeclared profits are a major red flag.
Is mining cryptocurrency legal in India?
Mining is not explicitly banned, but it’s legally unregulated. There are no rules about electricity usage, equipment import, or reporting mining income. However, any profits from mining are subject to the 30% tax. Many miners operate quietly, but they face risks like power cutoffs or legal challenges if authorities decide to treat mining as an unlicensed business activity. There is no official guidance, so miners operate in a legal gray zone.
Will the Supreme Court ban crypto in the future?
Almost certainly not. The court has already rejected a total ban as unconstitutional. In 2025, justices explicitly said banning crypto would be unwise given global financial trends. Instead, the court is pushing the government to create regulation. The judicial stance is clear: regulate, don’t ban. Any future ban would require new legislation - and the Supreme Court would likely strike it down again.
Why are Indian crypto startups leaving the country?
High taxes, regulatory uncertainty, and lack of legal clarity make it risky to build crypto businesses in India. Startups face difficulty raising capital, opening bank accounts, or attracting international partners. Countries like Singapore, Switzerland, and the UAE offer clear licensing, lower taxes, and investor protection. Many Indian founders have relocated their operations there to access global markets and avoid constant legal risk.
Can I use DeFi or NFTs in India legally?
There is no official answer. The Supreme Court’s ruling only addressed traditional crypto trading. DeFi protocols, NFT marketplaces, and smart contracts exist in a legal gray area. You can use them, but there are no rules on how to report income, who is liable if a protocol fails, or whether they’re considered financial instruments. Tax authorities treat any gains as taxable, but no guidance exists on how to calculate or document those gains. Use them at your own risk.