Now, tax will have to be paid on the profit made from cryptocurrency in the country. The Income Tax Appellate Authority of Jodhpur has clarified the situation regarding tax on this currency.
The authority said, cryptocurrency is an asset, the profit from its sale should be classified as capital gains rather than income from other sources. The profit earned on the purchase and sale of crypto before the 2022 rules should be considered as capital gains and taxed accordingly.
From April 2022, income arising from sale and transfer of virtual digital assets is subject to 30% tax, surcharge, cess.
Case: The person in whose case the authority has given its verdict bought cryptocurrency worth Rs 5.05 lakh in 2015-16. Sold it for Rs 6.69 crore in 2020-21. The person held the crypto for 3 years, the tribunal said that the profit should be treated as long term capital gain. The authority directed the income tax officer to allow the person the benefit available under the law for long term capital gains. This means that the taxpayer can claim the benefit or deduction applicable on long term investments.