ITR Filing 2026: With the income tax return (ITR) filing season underway, cryptocurrency investors need to pay close attention to tax reporting, as digital assets are subject to a separate tax regime in India.
Unlike equity investments, crypto transactions attract specific tax provisions, and overlooking them can lead to incorrect filings.
Pranav Pagaria, senior vice-president (finance & strategy) at CoinDCX, said a growing number of first-time crypto investors are entering the market from traditional investment avenues, making awareness around crypto taxation more important than ever.
“We are seeing a steady stream of new investors entering crypto, many of them coming in from equity and traditional markets. This is encouraging for the industry, but it also means there is a learning curve when it comes to tax compliance, since crypto taxation works quite differently from equities,” Pagaria said.
He also said that one of the most common misconceptions among investors is treating the 1 per cent Tax Deducted at Source (TDS) on crypto transactions as the final tax liability.
“A common misunderstanding we notice is that investors assume a 1% TDS deduction by the exchange takes care of their entire tax obligation, when the actual liability under Section 115BBH still needs to be computed and paid separately,” he said.
Pagaria advised taxpayers to maintain detailed records of all crypto transactions, verify TDS deductions with Form 26AS, and ensure that income from every crypto platform is accurately disclosed while filing returns.
“Our advice to investors this filing season is to maintain complete transaction records, reconcile TDS through Form 26AS, and disclose all crypto-related income accurately, regardless of which platform it originated from,” he added.
He further said that exchanges are increasingly providing tools to simplify tax compliance for investors. “We have built automatic TDS deduction, detailed transaction histories, and tax calculation tools directly into our platform, so that filing correctly becomes simple rather than daunting,” Pagaria said.
