Income from transfer of a virtual digital asset is taxed at a flat rate under section 115BBH. Only the cost of acquisition is deductible — no expenses, no indexation. A loss on one coin cannot be set off against a gain on another, and nothing can be carried forward. Separately, section 194S puts a TDS obligation on the transfer itself.
What actually causes trouble is data. The department receives exchange reporting, and returns get picked up on mismatch. Where you have traded across several exchanges, or moved assets to self-custody, or used a foreign platform, the reconciliation is the real work — and foreign holdings bring their own disclosure schedule with penalties that dwarf the tax.
What we handle
- Computation under section 115BBH, transfer by transfer
- Correct treatment of the no-set-off and no-carry-forward rules
- TDS under section 194S — who deducts, at what point, and Form 26QE where it applies
- Reconciliation of statements across multiple Indian exchanges
- Foreign exchange and self-custody wallet positions
- Schedule VDA in the return, filled transfer-wise as required
- Foreign asset disclosure in Schedule FA where assets are held offshore
- Airdrops, staking rewards, mining and gifts — which fall under which head
- AIS mismatch review before filing, and rectification where the AIS itself is wrong
- Reply to notices arising from exchange reporting
What you supply
- Transaction and trade statements from every exchange used during the year
- Wallet addresses and transaction history for self-custody holdings
- Bank statements showing deposits to and withdrawals from exchanges
- TDS certificates or 26AS entries for tax deducted under 194S
- Details of any foreign exchange or foreign wallet used
- Records of airdrops, staking rewards, mining income or assets received as gifts
Export the full-year statement from each exchange rather than screenshots of individual trades. Where an exchange has shut down or you have lost access, tell us — there are other ways to build the record, but they take longer.
How the engagement runs
From raw statements to a filed schedule
STEP 01
Statements collected
Every exchange, wallet and bank account for the year is listed, so nothing sits outside the working.
STEP 02
Reconciled
Trades matched to bank movement and to what the AIS already shows against your PAN.
STEP 03
Computed
Gains computed transfer-wise under 115BBH, with TDS credit claimed and the schedule prepared.
STEP 04
Filed and explained
The return is filed and you get a working you can produce later if the department asks.
Before you call
Questions we are asked about this
Can I set off a loss on one coin against a gain on another?
No. The regime does not permit set-off of a loss from transfer of a virtual digital asset against any other income, including gains on another virtual digital asset, and no loss can be carried forward. Each gain is taxed on its own.
Are expenses like exchange fees or internet costs deductible?
Only the cost of acquisition is deductible. Trading fees, interest, infrastructure and other expenditure are not.
I only moved coins between my own wallets. Is that taxable?
A transfer between wallets you control is not a transfer for consideration, so it does not by itself create income. But it does need to be documented, because on-chain movement without a matching record is exactly what triggers questions later.
What if I did not report crypto in earlier years?
Depending on the year, an updated return may still be available with additional tax. It is a much better position than waiting for the department to raise it from exchange data, which it now receives directly.
Send us your exchange statements for the year
You do not have to know the name of the form. Describe the situation and we will identify the filing, the authority and the realistic timeline before you pay anything.