India’s tax authorities have issued new guidance to regulate crypto trading, bringing in stricter reporting requirements for firms and aligning with OECD standards to improve cross-border transparency.
India’s tax authorities have moved to tighten oversight of crypto trading, with the Central Board of Direct Taxes issuing a detailed guidance note for firms that facilitate digital-asset transactions. According to Business Standard and Mint, the note is meant to help Reporting Crypto-Asset Service Providers understand how to comply with the new regime under the Income-tax Act, 2025 and related rules. It is designed to bring India’s approach into line with the OECD’s Crypto-Asset Reporting Framework, which is intended to make cross-border crypto activity more visible to tax authorities.
The guidance sets out a broad definition of a crypto-asset as a digital representation of value that uses cryptographically secured distributed ledger technology or a similar system. Mint and Moneycontrol reported that only “relevant crypto-assets” fall within the reporting net, while Central Bank Digital Currencies, specified electronic money products and assets that cannot be used for payment or investment are excluded. The note also indicates that NFTs traded on marketplaces will generally be treated as reportable assets.
The compliance burden will fall on a wide range of intermediaries, including exchanges, brokers, market makers, trading platforms and operators of crypto ATMs. The framework applies not only to firms acting as principals but also to those operating as intermediaries, counterparties or platform providers. According to the guidance as summarised by Business Standard and a2ztaxcorp, a provider will have a reporting nexus in India if it is tax resident there, incorporated or organised under Indian law, managed from India, required to file returns in India or operating through a regular place of business in the country.
The note also introduces due-diligence and record-keeping duties that are likely to force firms to upgrade their compliance systems. Reporting Crypto-Asset Service Providers must identify reportable users, collect self-certifications on tax residency, retain records for at least seven tax years and file information through Form 167. Mint reported that the system is procedural rather than a change in tax rates, but it should make exchange data and taxpayer filings easier for authorities to match, increasing scrutiny of crypto transactions and narrowing the room for mismatch or omission.
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