Short answer: In its 2026–27 Union Budget, India kept crypto taxed at a flat 30% on gains plus 1% TDS on transfers — unchanged despite industry requests for relief. From 1 April 2026, new penalties apply for reporting lapses (₹200/day for non-filing; ₹50,000 for incorrect info) under Section 285BAA. Separately, the Financial Intelligence Unit (FIU-IND) has issued blocking orders against unregistered offshore exchanges. The practical takeaway: use FIU-registered platforms and keep clean records.
Here's what actually changed and what it means for you.
The tax stayed harsh
- 30% flat tax on gains from Virtual Digital Assets (VDAs), payable each financial year.
- 1% TDS deducted at source on transfers.
- No deductions except acquisition cost; losses cannot be offset against other income or carried forward.
Industry groups had lobbied to cut the 1% TDS (to ~0.01%) and allow loss offsets. The 2026 Budget declined — rates are unchanged.
New from April 1, 2026: reporting penalties
Instead of relief, the government added enforcement. Under Section 285BAA (inserted by the Finance Act 2025), reporting lapses now draw:
- ₹200 per day for non-filing of required crypto-transaction reports
- ₹50,000 flat for incorrect or uncorrected information
This runs alongside the Section 509 reporting regime and aligns India toward the OECD's CARF standard by 2027.
The offshore crackdown
The FIU-IND is tightening the screws on unregistered foreign platforms. On 10 March 2026, it issued fresh blocking orders under the PMLA against offshore exchanges operating without registration, having earlier ordered takedowns targeting around 25 offshore apps and URLs.
Registered vs offshore (quick table)
| Factor | FIU-registered (India) | Unregistered offshore |
|---|---|---|
| Legal status | Compliant (Reporting Entity) | Facing blocking orders |
| 1% TDS handling | Usually automatic | Your responsibility |
| Access risk | Stable | May be blocked |
| Examples | CoinDCX, and ~49 registered VDASPs | — |
As of FY2024–25, nearly 50 VDASPs are FIU-registered (about 45 domestic + 4 offshore that accepted local compliance).
What it means for you (practical steps)
- Use an FIU-registered exchange — cleaner 1% TDS handling and no blocking risk.
- Keep records for 5 years — mandatory, and penalties now apply for lapses.
- Budget for 30% + 1% TDS — and remember losses don't offset.
- Self-custody larger holdings — the exchange is where you buy, not where you store.
FAQ
What is the crypto tax in India in 2026?
A flat 30% on gains plus 1% TDS on transfers — unchanged in the 2026–27 Budget.
Are there new penalties?
Yes, from 1 April 2026: ₹200/day for non-filing and ₹50,000 for incorrect reporting under Section 285BAA.
Are offshore exchanges banned?
Not banned outright, but the FIU issued blocking orders against unregistered offshore platforms in March 2026. Use FIU-registered ones.
Can I offset crypto losses?
No — losses cannot be set off against other income or carried forward.
Educational information, not financial or tax advice; rules can change, verify with the Income Tax Department/FIU-IND. Full India exchange comparison and funding guide: Best Crypto Exchange in India.
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