India Compliance Report

Regulatory Overview

Regulatory Status

Some rules exist but significant gaps; draft legislation or limited guidance

Key Regulator(s)

Ministry of Finance

Risk Level

high

Primary Legislation

Prevention of Money Laundering Act (amended 2023) (2023), Finance Act 2022 (Section 115BBH) (2022), Crypto tokens are not explicitly classified in India; there is no law defining c, No primary legislation exists; regulation occurs via RBI guidelines on tokenisat

Travel Rule

Adopted — Threshold: $1,000

Tax Reporting

Most punitive crypto tax regime globally: 30% flat tax on crypto income; 1% TDS on all transactions above INR 50,000; NO loss offset allowed. TDS has massively reduced domestic trading volumes.. Transfers and trading: Flat 30% on profits.. Mining, staking, and airdrops are generally treated as VDA income at 30%, but the cost basis for mined crypto may not be zero if the taxpayer can substantiate acquisition costs; expenses like electricity remain non-deductible.. Gifts: Taxable at 30% if from non-relatives exceeding ₹50,000; relative gifts exempt.. Non-VDA income (e.g., salary in crypto) may fall under slab rates, but VDA-specific rules dominate.

Key Facts

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