Crypto Tax India: What You Need to Know About Reporting Crypto in 2025

When you buy, sell, or trade crypto in India, the government treats it like property—not currency. That means every trade could trigger a capital gains tax, a tax on profit from selling an asset. Also known as crypto income tax, it applies whether you turned Bitcoin into Ethereum, sold Dogecoin for rupees, or used crypto to buy a laptop. The rules aren’t vague—they’re strict, enforced, and getting tighter every year.

India’s tax system now tracks crypto through VASPs, Virtual Asset Service Providers like exchanges and wallet platforms. Also known as crypto exchanges, these platforms are required to report user activity to the Income Tax Department. If you traded on WazirX, CoinDCX, or Binance India, your transactions are already on their radar. The government doesn’t need your permission to see your history—it just needs your PAN number. And it’s not just about profits. Even gifting crypto, earning staking rewards, or receiving airdrops can be taxable events. You don’t get a pass just because you didn’t cash out.

There’s no gray area: if you made money, you owe tax. The rate? 30% on gains, plus a 4% cess. No deductions. No offsetting losses against other income. And if you didn’t report? You could face penalties up to 200% of the tax due, or worse—legal action. The 2025 crackdown isn’t theoretical. Thousands of notices have already gone out to people who didn’t file. Some got lucky and paid a small fine. Others are now stuck in audits that take years to resolve.

What about mining? If you’re running a rig in India, you’re not exempt. The income from mining is treated as business income, not capital gains. That means you can deduct electricity and hardware costs—but only if you keep perfect records. Most people don’t. That’s why so many end up paying more than they should.

And here’s the catch: the rules don’t care if you’re a beginner or a pro. Whether you bought your first ETH in 2023 or traded daily since 2017, the tax office treats you the same. Your wallet address doesn’t hide you. Your exchange’s privacy settings won’t protect you. The only thing that does? Accurate records, timely filings, and knowing what counts as a taxable event.

Below, you’ll find real examples of how people got caught, what the government is looking for, and how to stay ahead of the next wave of enforcement. No fluff. No theory. Just what actually matters when you’re filing crypto tax in India in 2025.