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How to report cryptocurrency transactions in your ITR

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By Sangeeta Ojha

3 min read | Updated on July 15, 2026, 16:36 IST

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SUMMARY

For the financial year 2025-26 and assessment year 2026-27, you will need to declare your cryptocurrency taxes using either the ITR-2 form if reporting as capital gains or the ITR-3 form if reporting as business income.

How to report cryptocurrency transactions in your ITR

The due date to file ITR-1 and ITR-2 for AY 2026-27 is July 31, 2026. | Image: Shutterstock.

Filing your Income Tax Return (ITR) is only half the job. After submitting your return, you must verify it within the prescribed time to complete the filing process. It's equally important to ensure that all your income and investments are correctly reported and match the details available with the Income Tax Department to avoid notices, scrutiny or delays in receiving your refund.

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One area taxpayers should pay close attention to is Virtual Digital Assets (VDAs), such as cryptocurrencies and non-fungible tokens (NFTs). In India, gains from the transfer of VDAs are taxed at a flat 30%. The Finance Act, 2022 introduced the term "Virtual Digital Asset" by inserting Section 2(47A) into the Income-tax Act, bringing cryptocurrencies, NFTs and certain other digital assets within the tax framework.

How to report crypto income in your ITR

For the financial year 2025-26 and assessment year 2026-27, you will need to declare your cryptocurrency taxes using either the ITR-2 form if reporting as capital gains or the ITR-3 form if reporting as business income.

Taxpayers should report all taxable crypto transactions in Schedule VDA of their ITRs. This includes the sale, exchange, or transfer of cryptocurrencies like Bitcoin, Ethereum, and other virtual digital assets.

According to CA Abhishek Soni, CEO & Co-founder, Tax2win, here's what taxpayers should keep in mind:

Claim TDS credit: If 1% TDS was deducted on your crypto transactions under Section 194S, claim the credit while filing your ITR.
Choose the correct ITR form: Most taxpayers with crypto transactions will need to file ITR-2 or ITR-3, depending on whether the income is treated as capital gains or business income.
Maintain records: Keep exchange statements, wallet history and TDS details safely to ensure accurate reporting and to support your return if required.

Where should VDA income be disclosed?

Crypto and other VDA transactions must be reported under Schedule VDA in ITR-2 and ITR-3. Taxpayers are required to disclose their VDA transactions individually, and the gains are taxed at a special rate of 30%.

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How is crypto taxed in India?

Soni says taxpayers should also remember these key tax rules:

30% tax on gains: Profits from the transfer of cryptocurrencies and other VDAs are taxed at a flat 30%, plus applicable surcharge and cess.
Only purchase cost is deductible: While calculating taxable gains, only the acquisition cost can be deducted. No other expenses or allowances are allowed.
No set-off of losses: Losses from crypto transactions cannot be adjusted against any other income or carried forward to future years.
The due date to file ITR-1 and ITR-2 for AY 2026-27 is July 31, 2026. For non-audit business income, the due date is August 31, 2026.
Have a personal finance, mutual fund, or income tax query? We will try to get them answered by experts. Write to sangeeta.ojha@rksv.in
For all personal finance updates, visit here

About The Author

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Sangeeta Ojha is a business and finance journalist with experience across leading media platforms like Mint and India Today. She has built a reputation for covering a wide range of personal finance topics, including income tax, mutual funds, insurance, savings and investing.

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