Income Tax Department Rectifies Gaffe, “Restores” 1% TDS On Virtual Assets After “Reduction”

Income tax department fixes blunder, 'restores' 1% TDS on virtual assets after 'reduction'

Income tax department clarifies TDS on virtual digital assets to remain at 1 percent

In a sort of confusion, the income tax portal on Wednesday updated its document on tax-deductible at source (TDS), reiterating that TDS on virtual digital assets will remain at 1 percent, as stated in the EU’s 2022-23 budget, after it had previously stated that the rate had fallen to 0.1 percent.

There was a stir after it was previously reported on the department’s website that the TDS rate for virtual digital assets has been reduced to 0.1 percent from the 1 percent TDS on such assets announced in the Union budget.

However, after the change was noticed by a cross section of people, the website updated the document to correct the error.

Several crypto platforms and investors actively discussed the matter on social media.

The website had also added that no tax will be applied, if the total value does not exceed Rs 10,000 during the fiscal year and does not exceed Rs 50,000 during the fiscal year, which remains unchanged.

The 1 percent TDS on virtual digital assets will come into effect from July 1, 2022.

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