Crypto Tax India 2025: Rules, Penalties, and What You Must Know

When it comes to crypto tax India 2025, the strict tax framework imposed by the Indian government on digital asset transactions. Also known as Indian crypto taxation, it treats cryptocurrency like gambling—profits are taxed at 30%, losses don’t count, and every trade triggers a 1% TDS deduction. There’s no deduction for losses, no carry-forwards, and no way to offset gains against losses from other trades or assets. If you made ₹50,000 in profit on Bitcoin but lost ₹80,000 on altcoins, you still owe tax on the ₹50,000. The system doesn’t care about your net result—it only sees the winners.

This isn’t just about numbers. It’s about how the rules no loss offset rule India, a policy that prevents crypto traders from using losses to reduce taxable income crushes active traders. Unlike stocks or futures, where you can balance your books, crypto traders in India pay tax on every single profitable trade—even if they’re down overall for the year. Add in the crypto TDS India, a 1% tax deducted at source on every crypto transaction, regardless of profit or loss, and you’re paying twice: once upfront when you trade, again when you file. This double hit makes small trades pointless and punishes those who try to time the market.

The crypto losses not deductible, a core feature of India’s crypto tax regime that denies any tax relief for losing positions rule forces traders into a lose-lose situation. You can’t claim losses against other income, you can’t carry them forward to next year, and you can’t use them to reduce your TDS burden. Even if you bought Ethereum at ₹4 lakh and sold it at ₹1.5 lakh, that ₹2.5 lakh loss disappears on paper. Meanwhile, if you sold Solana for a ₹10,000 profit—even after losing ₹2 lakh elsewhere—you owe ₹3,000 in tax right away. The government doesn’t track your portfolio; it tracks every sale. That’s why many traders now avoid small trades, hold for years, or move to offshore platforms—despite the legal gray zones.

What makes this worse is the lack of clarity. There’s no official guide on how to report multiple wallets, how to handle airdrops, or whether staking rewards count as income. You’re left guessing, filing manually, and risking penalties. The rules haven’t changed much since 2022, and in 2025, they’re still as rigid as ever. No exemptions. No relief. No leniency.

Below, you’ll find real breakdowns of how these rules hit traders, what scams exploit them, and which platforms make compliance harder—or easier. No fluff. No theory. Just what you need to know before you trade, sell, or file.