Indian government asking for 30 % tax on p2p transactions from Binance users.

#Binance users don’t have the #crypto calculator and also indian users are not aware with taxes. 🙏

Important thread 🧵 for indian crypto 🇮🇳 traders:

Some people trading in crypto are on platforms like #Binance

There they are avoiding the rules of #TDS

But the Income Tax Department has come to know about this

The Income Tax Department can now take action against such people

The Income Tax Department is keeping an eye on crypto traders. Actually, some people are using platforms like @Binance to save TDS. On this, some crypto traders are trying to avoid this tax. The Income Tax Department has come to know about this.

These days, there are a lot of news about crypto currency. Earnings have also increased due to this. Therefore, Indians have also started participating in its trading. But, they did not know that the income tax officials are also keeping an eye on them. Now the news has come that many Indians trading on the world's largest crypto exchange Binance have now come under the radar of tax officials.

What are IT officials looking at

For the past few weeks, Income Tax (I-T) department officials have been investigating whether the 1% tax deducted at source (TDS) on such deals has been deducted or not. The tax office has issued a notice (Income Tax Notice) asking local investors for proof of TDS deduction or documents proving why TDS does not apply to them. This means that the government wants to see whether people investing in crypto are paying taxes or not.

Where did the money come from

The Income Tax Department is also finding out where these crypto traders got the money from. Officials have sought I-T returns from such traders for the years when the funds used to buy crypto were earned. Some of the Income Tax Department notices have raised questions on transaction data downloaded from the website of foreign exchanges. In this, 30% tax has been imposed on the entire turnover, whereas tax should be levied only on profits. This means that the government suspects that some people are evading taxes.

These will also come under the scanner

If the Income Tax Department expands the scope of its investigation in this regard, it may affect many Indians who have transferred their crypto holdings to foreign platforms like Binance in the last two years. Some NRIs (Non-Resident Indians) or people settled abroad have also transferred their crypto assets from local exchanges to foreign exchanges and private wallets. They convinced the domestic platform by saying that they are withdrawing coins for genuine reasons.

Most transactions are P2P deals

Most of the transactions done by Indians on Binance are peer-to-peer (P2P) deals. In this, the platform matches the buyer and the seller, who deal in rupees locally. However, traders here sometimes inadvertently and often deliberately ignore the rule that the buyer has to deduct TDS on direct P2P deals and foreign exchanges. Unlike trades on domestic platforms, where exchanges deduct TDS and deposit it with the government, this does not happen here. Moreover, when one crypto is bought for another crypto – such swaps often happen in foreign exchanges – TDS applies to both the buyer and the seller. This means that if you are transacting in crypto, you need to take care of TDS rules.

Why is the Income Tax Department active

For over a year, local exchanges have tightened coin withdrawal rules over fears of money laundering. Once crypto is withdrawn from a local wallet, a trader can do practically anything with the coins: shift them to a private wallet or sell them abroad or swap them for another coin. Such trades, apart from violating rules on foreign exchange control, also raise concerns about the use of crypto for illegal activities. This means that the government is keeping a close watch on the use of crypto to ensure no wrongdoing takes place.

I think we have cleared all things about the issue in india 🇮🇳 about 1 % tds and 30 % tax. ✅

You can connect me for more information @Aman Sai ❤️