I wrote in my recent post about Income Tax officials in India raiding several Indian bitcoin and alt-coin exchanges. It has led to a new development; I-T department is now sending notices to 400,000 to 500,000 High-Net-Worth Individuals (HNWI) on suspicions of tax evasion.
From my early days on Steemit, as well as on Facebook and other channels I have communicated to users from India investing in cryptocurrencies to look up their tax liability and file the income tax returns to avoid running into the authorities at any point in time.
I've stated this several times to Indian users involved in the cryptocurrency space, to do their due diligence, and find out their income tax liability arising from investing in Bitcoins.
Steemit Users from India
India is steadily adding over 200K new investors on Indian bitcoin exchanges. For Steemit, India is 4th highest source of it's traffic. If you are earning and cashing out your Steemit earnings, you are liable to pay tax.
Recently, my well researched guide on filing your tax returns was published by TheQuint. In case your auditors are unaware about the taxation nitty-gritties surrounding Bitcoin you are welcome to share my guide them so he can analyse it and figure it out.
Many have benefitted from the directions pointed out in my article on filing your tax returns on your bitcoin gains. It is accurate given the current policies (or lack thereof) of the Indian government towards Bitcoin. But feel free to do your own research first-goes without saying.
The Bangalore Income Tax wing is considered amongst the most aggressive wings of the I-T department in the country. It led the raid last week and supervised the whole operation. It has now dispatched the details on entities on the databases of Indian exchanges that it scrutinised to 8 other such I-T wings pan-India.
Conclusion:
Individuals and businesses whose records were recovered during the raid are being probed under tax-evasion charges. These individuals and businesses will have to compulsorily pay capital gains tax on their Bitcoin investments. But beyond this there seems to be no other legal action being taken.
Please visit your local auditor and have them look into your accounts at the earliest if you haven't filed your returns.
What Do I think?
I think this is a good move which should ideally lead to faster legalisation of Bitcoin use and cryptocurrency trade in the country.
If you like my work kindly resteem it to your friends. You may also continue reading my recent posts which might interest you:
- Steemit Mentioned In: How to File Tax Returns in India for Your Bitcoin Profits—My Latest Feature In TheQuint!
- 4 Tips For Steemit Account Recovery & Wallet Security!
- Steemit.Chat Contest #9 + Contest #8 Winners Announcement!
Which is why it's better to pay taxes than messing with the laws.
The govt can Max ask to pay taxes since they tehmselves don't have a framework around the whole crypto thing.
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Agree that we should always pay our taxes. But I don't agree with paying 30% taxes (If you are investing it cryptocurrencies and doing it right you shall fall in this category :P). Especially since there are so many risks associated with trading in cryptocurrencies today and Government regulations are only making it more difficult.
If government wants to charge taxes on cryptos they should make things easier for the end users. Moreover since they are charging taxes on these gains the government should also invest some part of the budget in Crypto startups and eco system.
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I fully agree!
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I think it will be cool if people pay tax from cryptocurrency earning. But how would the tax be measured. Earnings are not fix/constant. It will be a hell of calculation to measure taxes. Take for example steemit earning, how do you measure tax when part of the earning is in steem power which cannot be withdrawn immediately.
Or maybe i dont get the whole tax thing and how it can be quantified yet.
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Any cryptocurrency that is not held in Indian exchanges cannot be traced by Indian government. Any cryptocurrency that is not encashed to your bank account cannot be taxed.
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Yes, definitely a good move. Just a small doubt, if bitcoin or other cryptos were declared as currencies, which I think Japan has done, such taxes wouldn't apply, correct?
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I agree that it should lead to the faster legalization of bitcoin use and other cryptos in the country. Anything that I made and took out here I set a little bit aside to make sure I paid my taxes so that I could avoid any issues such as what is occuring in India now.
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Absolutely right man and thats a good thing you did!
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This is the example that we should never mess with govt. and laws.
This is really a very informative and nice post.
Thanks for sharing
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You are welcome. :)
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This is kinda good kinda bad situation
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Agreed! You are right.
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thank you... Very helpful information you shared , @firepower :)
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You are most welcome. :)
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😊😊
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It's always better to pay tax, money is money even if the sources are not known then also we all are liable to pay tax.
Thanks for sharing this vital information.
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Yap and you are welcome.
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Thanks
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@firepower not to evade tax if we are correct. Although filling income tax is must for all tax payer. If we are in right way, why we need to hide.
Good point raised , the crypto raids will act as publicity inciting more people to invest..and hence govt need to regulatr the same instead of banning (my thought)
One query.... is encashing is only taxable or our balance in steemit wallet too??
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@steemflow encashing only.
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Thanks..👍
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Thank you friend. Your research and knowledge of crypto world can help us. This is a great information. As an indian citizen it is important if we do the due diligence. ITR is important.
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Thank you!
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How can the Indian government miss the opportunity to get their cut from the crypto market?
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very useful post. lot of the issues are a knowledge to me from this post. as you mentioned by taxing bitcoin Government has to recognize bitcoin. a good development. i also have a doubt. as it is taxes are high in our country. if they levy heavy taxes what is the benefit by the struggling in earning bitcoin.
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But not everyone is stealing tax, Some consider it an instrument to earn money online. To eliminate unemployment
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बिटकॉइन पे लोग कमाई कर रहे हैं, तोह सरकार भी अपनी कमाई का नया साधन चाहती है । इस लिए नोटिस भेज रहे हैं । 😂
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It doesn't matter how hard they fight it, how illegal they make it, bitcoin is unstoppable
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Very helpful @firepower.
Your posts are very useful and helping at the right moment.
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thank you
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every where in my state and in your we have to pay these taxes which is beyond our scope always @firepower
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during the demonetization, I was suspecting people will use crypto. Especially those with unaccounted cash. Not sure whether that really happened or not. Right now with the low GDP and some 39K deficit from GST I think govt will go after every possible means to make money!
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Demonetisation hardly affected those with unaccounted cash. Waste of public funds!
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Also an impact to environment - all those paper wasted !
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Good work @firepower in looking out for our Indian Steemit Brothers to make sure they remain trouble-free. We want everyone to have a safe and profitable 2018! :)
source
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Thank you! :)
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Personally,I dint yet reach the level where I'm supposed to pay taxes for my crypto earnings, my income is still very low. But like most of us in India ,Id love to see the currency trading being legalised.
Btw, I'm planning on investing on steem and dogecoin, which site do you is best to trade in India?
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The Bitshares DEX (Decentralized Exchange) is available globally and both Steem and Doge are traded on it.
https://bitshares.org/
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Your thought is right
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I dont know much about taxes but I believe I have read somewhere that you dont need to pay income taxes if you earn less than 2.5 Lakh annually in India. So lets say someone is earning 2 Lakh per annum does he/she still need to file tax returns?
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