How to File Taxes for Cryptocurrency in India

Have you invested in crypto last year? Then you are required to know about the new Tax implementation in India. During the Budget session, the authorities announced that the crypto user is required to pay a flat rate of 30% for crypto transactions.

Every crypto coin, such as Bitcoin, Ethereum, as well as other Cryptocurrencies is also taxable. Changes in the tax on crypto in India allow you to easily buy and sell cryptocurrency with taxes. New investors are buying in for the first time, and it is necessary to know about the methods of filing the taxes for the cryptocurrency.

Paying Taxes for Crypto:

Bitcoin investors began investing in it more than 12 months. The Crypto market has recently hit multiple all-time highs and lows throughout the year. These also lead to higher gains and losses for the investors.

Whether you are looking to buy or sell crypto coins then, you need to know about the crypto taxes in the country. People who buy as well as trade crypto in online exchanges would be accounted for in the Tax returns. It is quite an easier option for getting tax returns with every transaction coded safely.

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Purchasing Crypto:

When you like to report cryptocurrency trades on your tax return, then you can easily choose the safer crypto exchanges. Buying virtual currency and keeping it within the exchange where you purchased your personal wallet. This does not mean that you would be paying the taxes even at the end of the year.

When you are doing crypto-related activities such as purchasing a virtual currency with fiat currency, then you do not have to report to the IRS. Complete guidance would be listed in the Form 1040 tax return.

Trading Cryptocurrency:

When you are using crypto as a method of exchange, then you are becoming taxable. It includes selling the crypto for fiat currency and even exchanging them for another cryptocurrency. Whether you are buying Ethereum with Bitcoin cryptocurrency, or when you use crypto as a method of exchange, you are required to pay taxes.

How Do You Report Cryptos on Taxes?

Normally, Filing the cryptocurrency gains, as well as losses, is more important. These should be quite similar to that of cryptocurrency in stocks or other forms of property. If you sell the investment or exchange it for another investment is taxable based on the transaction. It is necessary to be careful when you are trading cryptos.

Calculate Your Crypto Gains and Losses:

Calculating every transition includes selling the crypto, exchanging one cryptocurrency for another, or even buying the Bitcoin with Ethereum. If you would like to know how I file taxes for cryptocurrency, then you need to first calculate the crypto gain and losses. It is quite necessary to record the activity as you dispose of the cryptocurrency so it will incur capital losses or gain. 

They are not limited to selling cryptocurrency for fiat or even trading the cryptocurrency for another cryptocurrency. It is also necessary to Complete IRS Form 8949 for filing the Tax.

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