Simplified 1% / 5% on cryptocurrency TDS

As a rule, a tax of 30% on your annual profits will apply every year, at the end of each financial year, while the 1% TDS will come into effect from 1 July on all sales and NFTs.

TDS is calculated on the “Total Amount” to be paid after excluding GST/fees collected by the Exchange. Any TDS collected in Cryptocurrencies will be converted to INR and the received INR value will be updated based on the respective transactions.

To make things more transparent, the inferred TDS will be indicated on the order details page immediately after the transaction is made. In the event that TDS is deducted as a crypto asset, the corresponding crypto value will be converted to the main cryptocurrency and the corresponding INR value of the deducted TDS can be found in the report.

Note:

Instead of 1% TDS, 5% TDS will apply when you have not filed the ITR for 2 years.

More information on different PAN:

For individual PAN cards: TDS 1% is applied when the upper limit of INR 10,000 is reached for the whole financial year. If the order is placed for INR 9000, no TDS applies. If the order is re-placed for INR 1,000, TDS 1% only applies. Because the user has reached INR 10,000 for the entire financial year.

For HUF (Hindu Undivided Family) PAN card: TDS 1% is applied when the upper limit of INR 50,000 is reached for the whole financial year. If the order is placed for INR 9,000, no TDS applies. If the order is re-placed for INR 1,000, the 1% TDS only applies. Because the user has reached INR 50,000 for the entire financial year.

Can PAN reveal your information?

Here is your quick reference…

Your 10-digit alphanumeric permanent account number (PAN), serves as identification.

Three initial characters: The first three characters range from AAA to ZZZ.

Fourth character: Your status is always shown by the fourth character of your PAN.

P denotes a person

C denotes a business

H standing for Hindu Undivided Family

F denotes a partnership firm

A stand for associations of people

T stands for trust

B for the body of people

L stands for local government

J denotes a synthetic juridical person

G represents government

Fifth letter: It’s your last name or surname that represents the fifth character.

The following four characters are sequential numerals from 0001 to 9999, making up the sixth through ninth characters.

Tenth character: An alphabetic check digit makes up the PAN’s final and tenth character. The nine previous letters and digits are used as input into an algorithm to create the alphabetic check digit.

I hope you now have a better understanding of the TDS mechanism. Please feel free to leave any questions in the comments section below if you have.

Cheers to trading.