Cryptocurrency: Nirmala Sitharaman, the minister of finance, mentioned it in her Budget 2022 speech. It was introduced under Finance Act 2022 Section 194S.
Bitcoin Price: People are now making significant investments in cryptocurrencies as well. People hope that by making this investment, their income will increase suddenly. However, it carries a high level of risk to invest in cryptocurrencies. There are a lot of these cryptocurrency traders in India. TDS will also soon be subtracted from cryptocurrency buyers’ purchases at the same time.
Regarding cryptocurrencies, the Central Board of Direct Taxes (CBDT) has published recommendations. From July 2022, these regulations will be in place. The purchase of virtual digital assets and cryptocurrencies over Rs 10,000 would be subject to a 1% TDS deduction under the new regulation. Let us inform you that this was said in the Nirmala Sitharaman, Minister of Finance, presented Budget 2022. The Finance Act of 2022’s provision 194S was used to bring it about.
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The new regulations state that a paper trail must be created and that cryptocurrency transactions must also be disclosed when filing an income tax return. Both the buyer and the seller of bitcoins will find the procedure simpler if this is done.
According to a Business Standard article, tax partner Amit Maheshwari of the tax and consultancy firm AKM Global stated that CBDT has adequately addressed the realistic issues. The exchange has been granted the duty of deducting TDS. Their regulatory and compliance burden will rise as a result.
The buyer-broker and the exchange may come to an agreement.
The buyer or his broker will be primarily responsible for deducting tax under section 194S of the Act in the event that the transfer of virtual digital assets occurs through an exchange. A formal agreement between the exchange and the buyer or his broker is another possibility in such a scenario.
According to the Agreement, the Exchange must pay tax for all such transactions on or before a specific date for the quarter. Explain that the exchange will also be required to file a quarterly statement (Form No. 26QF) for all such transactions of the quarter on or before the date specified in the Income Tax Rules.
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