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The income tax (I-T) department sent out 44,000 emails and messages to individuals for not filing cryptocurrency transactions in their FY25 returns.
The finance ministry told Parliament that the communication to the defaulters was sent via the Ministry’s “non-intrusive usage of data to guide and enable (NUDGE) taxpayers campaign”.
“… To create awareness among taxpayers regarding the disclosure of VDA and payment of tax, CBDT has recently launched NUDGE.. taxpayers campaign under which 44057 emails and messages have been sent to select taxpayers who had invested and traded in the VDAs but did not report the transactions in Schedule VDA of their… (ITRs),” minister of state (MoS) for finance Pankaj Chaudhary said.
The MoS also said that the government cumulatively collected INR 705 Cr in taxes from VDA income between FY23 and FY24. Raids and surveys blew the lid off an additional INR 630 Cr of unreported income from such assets.
Cryptocurrency is neither legal, nor illegal in India, but income from such assets, called Virtual Digital Assets (VDAs), including NFTs, is taxable.
Profits from VDAs are taxed at 30%, along with surcharge and cess. A 1% tax is also deducted at source (TDS) on all VDA transactions. Taxpayers are required to declare such incomes in the new Schedule VDA of ITR-2 and ITR-3 forms.
The government started taxing VDAs from FY23. MoS Chaudhary said the tax department had found several cases of tax evasion involving cryptos and similar assets. Actions taken in such cases include notices, e-verifications, reassessments, and raids, added the minister.
This comes a month after reports surfaced that the Central Board of Direct Taxes (CBDT) was probing alleged tax evasion and laundering of unaccounted funds by high risk persons via investments in cryptocurrency.
Meanwhile, there appears no consensus on formulating clear norms for the space. In June, the Supreme Court pulled up the Centre for delaying the process of regulating the trade of cryptocurrency in India.
However, a month later, Reserve Bank of India (RBI) Governor Sanjay Malhotra, in terse words, said that cryptos could hamper the financial stability and the monetary policy of the country.
The post I-T Dept Pulls Up Taxpayers For Not Disclosing Crypto Transactions appeared first on Inc42 Media.
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