1% TDS on crypto explained, and how to get it back
How the 1% TDS on crypto works in India: when it's deducted, the ₹50,000 threshold, how to check it in AIS, and how to claim a refund when TDS exceeds your tax.
- Checked against the rules: Nov 2026
- Sources cited · No buy or sell calls
- Tax year 2026–27
, or tax deducted at source, is the 1% that disappears from every crypto sale on an Indian exchange. Many investors think of it as an extra tax. It isn't: it's an advance payment you can take back.
How crypto TDS works
When you transfer crypto, the buyer is required to deduct 1% of the payment and deposit it with the government against your PAN. On an Indian exchange, the exchange handles this for you, so your sale proceeds arrive 1% lighter.
TDS applies to:
- selling crypto for rupees,
- swapping one crypto for another, where it is often deducted in the coin received, and
- other transfers handled through exchanges.
The threshold
The thresholds depend on who pays you. TDS is required once the total paid to a seller in a financial year crosses:
- ₹50,000 when the buyer is a "": an individual or HUF with no business income, or with business turnover up to ₹1 crore or professional receipts up to ₹50 lakh,
- ₹10,000 when the buyer is anyone else.
In practice, Indian exchanges deduct 1% on almost every sale. The thresholds matter mostly for peer-to-peer and over-the-counter deals.
Why you pay TDS even on a loss
TDS is calculated on what you receive, not on what you earn. Sell ₹1,00,000 of Bitcoin that cost you ₹1,20,000 and you've lost ₹20,000, but ₹1,000 is still deducted. This is why so many crypto investors end up owed a refund.
Checking your TDS
Before filing, log in to the e-filing portal and open your Annual Information Statement (AIS) and Form 26AS. Crypto TDS appears there with the deductor's name, usually the exchange, and the amount. Compare it with your exchange's tax report. If something is missing, contact the exchange; it may not have filed its TDS return yet.
Claiming it in your ITR
When you file ITR-2 or ITR-3:
- Report your transfers in Schedule VDA. See how to fill Schedule VDA.
- Make sure the crypto TDS from your AIS appears in the TDS schedule.
- The return calculates your total tax and subtracts all TDS.
If TDS is less than your tax, you pay the balance. If it's more, the excess is refunded to your bank account after the return is processed.
A worked example
| Amount | |
|---|---|
| Total crypto sales in the year | ₹5,00,000 |
| TDS deducted (1%) | ₹5,000 |
| Total gains (no losses counted) | ₹10,000 |
| Tax at 30% + 4% cess | ₹3,120 |
| Refund due | ₹1,880 |
Try your own numbers in the crypto tax calculator.
Peer-to-peer and offshore trades
On peer-to-peer trades the buyer is legally responsible for deducting TDS once the thresholds are crossed. That means collecting the seller's PAN; without it, TDS is due at the higher rate of 20%. In practice this rarely happens on P2P platforms, which is one more reason to prefer an exchange's own INR rails. Buying P2P yourself? See how to deduct TDS as a buyer. Offshore platforms usually don't deduct it either. That doesn't remove your tax liability on gains. It just means there's no TDS to claim. Read our guide on P2P risks and foreign exchanges.
Frequently asked questions
Is TDS a separate tax on top of the 30%?
No. It is credited against the 30% tax you owe. You only lose it if you don't claim it.
How long does a TDS refund take?
Usually a few weeks after your return is processed, but it can take longer. Track it on the e-filing portal.
Do I get TDS back if I don't file an ITR?
No. The only way to claim it is by filing a return, even if your total income is below the basic exemption limit.
My AIS, Form 26AS and exchange report show different amounts. Which do I use?
Use Form 26AS amounts for the TDS claim and your actual sale values in Schedule VDA. Read what to do when crypto figures don't match.
When does 1% TDS apply on crypto?
On the sale value of crypto transfers above the threshold: ₹50,000 a year where the buyer is a specified person, otherwise ₹10,000.
How do I get crypto TDS back?
File your ITR, report your trades in Schedule VDA, and claim the TDS shown in your AIS and Form 26AS. Any excess over your tax is refunded.
Sources
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