The past few weeks have been historic for the cryptocurrency sector. The victory of Donald Trump has created a euphoria for Bitcoin enthusiasts. The price of Bitcoin since his victory has hovered from $79,000 to over $97,000. This is bound to have ripple effects on other cryptocurrencies and increase the demand for efficient crypto exchange trading platforms such as Valco Trading. Out of enthusiasm to make quick money, many people urgently want to convert their Bitcoins into cash. However, they should be aware of the rules and regulations in India such that their withdrawals do not incur additional expenses.

Here are the Key Points of the Crypto Income Tax Rules of India 

Investors who invest a substantial amount of money in Bitcoin and want to profit from the biggest crypto asset should ideally understand that there are two different types of taxes applicable. 

• Income Tax Act 1961

Section 115BBH of the crypto income tax rules of India, Act of 1961 states that one is required to pay 1% TDS (tax deducted at source) while transferring crypto tokens. Officially, the lawbooks call these tokens virtual digital assets (VDAs). The other rule states that one has to pay a 30% flat tax on any income generated from cryptocurrency transactions. Sales of cryptocurrencies if it incurs any losses cannot be carried forward in the next financial years.

• 30% Tax on Gains

There is a provision for a 30% tax on any gains made through cryptocurrencies. The interesting feature is that it does not take into account mainstream income sources. All gains are taxed equally and no legal differences are made between long-term and short-term gains. It is worth noting that Virtual Digital Assets (VDA) are included for reporting crypto or non-fungible tokens (NFT) gains.

• 1% Tax Deduction at Source (TDS)

The tax deduction at source is around 1%, if the transactions exceed ₹10,000. In specific circumstances, it can be ₹50,000. The deductions are however automatic and happen during the transactions themselves. It also eliminates extra paperwork. 

Also Read: How to Spot a Crypto Scam: A Complete Guide

Valco Trading Ensures Safe Conversion of Bitcoins Into Cash

Valco Trading guarantees fast, free, and easy-to-use cryptocurrency trading. It also offers OTC desk, conversion, spot, futures, and other valuable options. Crypto payments, copy trading, crypto loans, and staking are also available. Therefore, for any crypto investor and trader in India, Valco is highly useful. The other important fact is Valco is highly compliant with all relevant legal license requirements and this is why it is the most trustworthy, and regulated platform. Valco Trading was recently recognized as one of the top crypto trading platforms in India.

Bottom Line

The conversion of Bitcoins into cash is now a raging trend because of its spectacular rise since Donald Trump’s victory. However, in the context of Indian laws, one needs to be aware of the laws and regulations concerning digital assets. Awareness and choosing compliant trading platforms such as Valco can greatly reduce the possibility of any legal complications. Therefore, it is in the best interests of both new and existing crypto traders to know the crypto income tax rules of India before deciding to convert.