Cryptocurrency tax and TDS becoming the biggest issue among crypto business owners and traders. People looking to bypass crypto tax in India at any possible cost. IT ministry issued a circulation for keeping 5 years transaction record and KYC should be mandatory.
The government has not legally accepted cryptocurrency, as no bill related to it has been passed in Parliament yet. But by bringing cryptocurrency under the tax net, it has been proved that now the government’s approach is not to ban cryptocurrency.
From July 1, 2022, the government is charging a 30% tax on all cryptocurrency profits. And it will not be adjusted against any other income. Along with this, all exchanges have to take 1% TDS on each and every transaction.
Suppose you are trading with 1 crore in cryptocurrency and rotate your money 10 times, which means you buy and sell your crypto 10 times. This means you have to pay 1% TDS (1 Lakh Rupees) 20 times. Because TDS will be deducted on each transaction, buying or selling.
1% TDS and 30% tax is really bothering the traders. So, today we will share some tips to bypass crypto tax in India.
According to the basic rules of tax inside India, there is no need to pay any type of income tax on your earnings up to ₹ 500000. But if you trade in cryptocurrencies, then you are out of this scope.
And you will have to pay 30% tax and 1% TDS even if you earn less than ₹ 500000, TDS can be claimed at the time of filing the return.
We have prepared the plan for two types of people:
- Earning less than 5 Lakh in a year with crypto.
- Earning More than 5 Lakh in a year with crypto.
People Earning Less Than 5 Lakh in a Year
Those who earn less than ₹ 500000 need not worry much. If you want to avoid tax, then transfer all your friends on the decentralized exchange.
There is no KYC on the decentralized exchange. You have to connect your wallet for trading and earning.
Rotate your money so many times you want and finally at the end of the year transfer funds to your bank account.
Thus, you can escape so many TDS and transactions due to trading multiple times like buying in dump and selling in Pump.
Finally, you can transfer your funds through P2P or indirectly into the bank account. As you are earning less than 5 lakh. No one is going to ask you about tax and anything else.
People Earning More Than 5 Lakh in a Year
If you are earning more than 5 lakh in a year then you have to pay TAX to the government. If you are doing business in crypto, then work with decentralized exchanges.
Decentralized exchanges do not record your data. And you have to pay only the final tax on income.
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