CBDT Unveils New Crypto Tax Guidance in India

India's Central Board of Direct Taxes (CBDT) has released a new guidance note on cryptocurrency taxes, effective from July 26, 2026. The 198-page document clarifies how exchanges should report cryptocurrency transactions to the tax authorities.

The key change is that exchanges will now be responsible for reporting cryptocurrency transactions, rather than individual traders. This shift in responsibility aims to ease the burden of tax compliance on investors and promote the adoption of cryptocurrencies in India.

The guidance note also introduces a new framework for reporting cryptocurrency transactions, using the OECD's Common Reporting Standard for the Automatic Exchange of Financial Account Information (CARF). Exchanges must collect data on calendar year 2026 trades and file Form 167 by April 2027. The automatic exchange of this data with other countries will begin in April 2027.

The CBDT guidance note does not change the existing tax rates, which remain at a flat 30% for virtual digital assets and a 1% TDS rate. However, it emphasizes the importance of accurate reporting to avoid potential penalties and notice from the tax authorities.