The IT department overcomes the clumsiness, sticking to the 1% TDS on virtual assets. Read here

The Income Tax Department website on Wednesday updated its document on TDS, reiterating that the tax withheld at source for virtual digital assets or VDAs remains at 1%, as previously announced. reported in this year’s budget.

The portal mentioned earlier that Rate of TDS for VDA has been reduced to 0.1% from 1% as previously announced in the Union Budget for 2022-23. However, the IT department soon updated the error correction text.

Taking to Twitter, Income Tax India wrote, “Several media reports have come up with CBDT announcements claiming that the ratio of TDS to Virtual Digital Assets (VDA) has been reduced to 0.1%.”

It added, “By the way, it is made clear that there is no change in the ratio of TDS to VDA, which continues to be 1%.”

Many crypto platforms and investors discussed the matter on social media platforms.

The portal has also added that no tax will be applied, if the aggregate value does not exceed 10,000 throughout the financials and not to exceed 50,000 for the financial year, unchanged.

What is 1% TDS in Cryptocurrency Trading?

After taxing 30% on profits arising from crypto-assets, the Center will implement a TDS of 1% on the transfer or review of any transaction from July 1, 2022.

While industry players consider the move to be one of the most controversial provisions of crypto taxation, the Center believes that the new TDS mechanism is used to track transactions and prevent evasion. tax.

TDS is an enforceable obligation on exchanges to pay taxes on behalf of merchants on the platform. It will be calculated as 1% of the transaction value.

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