After reading various online posts about crypto regulations in India, I still find myself unclear about certain taxation issues. I am particularly interested in knowing at which points my crypto dealings are subject to tax. To illustrate:
When I convert cryptocurrency into Indian rupees, that amount is taxed.
However, I am uncertain whether swapping one cryptocurrency for another incurs tax as well.
Moreover, what are the tax rules if I simply hold cryptocurrencies and use them to acquire goods or services?
Based on my experience following crypto regulation updates in India, I believe that any time you dispose of cryptocurrency, whether by converting it to Indian rupees or swapping it for another cryptocurrency, it is likely considered a taxable event. Furthermore, using cryptocurrency to acquire goods or services is generally seen as a disposal since you are exchanging one form of asset for the other. Although holding crypto without any activity does not usually trigger tax, the moment you trigger a transaction, it may fall under capital gains taxation. It is advisable to maintain detailed records for clarity in assessments.
i think swapping cryptos is likely taxable since its like a conversion event. just holding them isnt taxed until you use them, but spending them could be, kinda like a disposal. keep accurate records and maybe check with a tax pro if youre unsure.
hey all, i’ve been reading up on this topic for a while now and it’s still a bit confusing to me. from what i understand, it doesn’t really matter if you’re converting crypto to rupees or swapping between cryptocurruncies – both actions might be seen as selling one asset to buy another, hence possibly triggering a taxable event. some folks mention that just holding your crypto shouldn’t count, unless you start using it for any sort of purchase, which is kind of like liquidating a portion of that asset. what do u guys think about how this really pans out in real transactions? do you reckon that even small transactions could be considered taxable, or is there some kind of threshold? would love to hear any real-life experiences or more questions to break it down further!