Crypto coin is not good for investors, IT department will bring new rules

According to a media report, the Income Tax Department is considering making a Permanent Account Number (PAN) card mandatory for cryptocurrency traders and investors and it will be in line with the demat account norms for equity trading. Currently, the declaration of investment in cryptocurrencies and related profits is voluntary. If the tax department enforces […]
 


Crypto coin is not good for investors, IT department will bring new rules

According to a media report, the Income Tax Department is considering making a Permanent Account Number (PAN) card mandatory for cryptocurrency traders and investors and it will be in line with the demat account norms for equity trading.

Currently, the declaration of investment in cryptocurrencies and related profits is voluntary. If the tax department enforces the PAN card order, crypto exchanges will have to submit the details of financial transactions to the income tax department.

A government official said the tax department wants income from cryptocurrency trading to be disclosed in the annual information statement of taxpayers for tax filing purposes. Therefore the tax department can direct crypto exchanges to provide information on all transactions done by their users.

The official said that making PAN card mandatory will help cryptocurrency investors in meeting Know Your Customer (KYC) requirements and ultimately better monitoring of such transactions and any incidents of tax evasion or money laundering.

Income tax return filing for assessment year 2022-23 does not show crypto transaction details. According to sources, taxpayers may have to provide such information while filing their IT returns from the next assessment year.

Under the new regime, effective July 1, such transactions will have to be declared in the IT returns and documents generated. In case PAN card details of the deductee (seller) are not available, tax will be levied at the rate of 20 per cent at the time of transfer of digital asset. Other than this

If a person does not file his income tax return, TDS will be charged at a higher rate of five per cent.