Do You Have to Pay Crypto Tax Below ₹50,000 in India?

Many crypto traders in India are unsure whether they need to pay tax on small profits. If your crypto earnings are below ₹50,000, do you still have to report them? Will the 30% crypto tax limit apply, or is there an exemption?

With India’s strict tax rules on virtual digital assets (VDAs), even small transactions can attract scrutiny. But does that mean every crypto trader—no matter how little they earn—must pay taxes?

In this blog, we break down India’s crypto tax limit, explain if low-income traders get any relief, and help you stay compliant without unnecessary stress.

 India’s Crypto Tax Rules

India has implemented strict tax policies for crypto traders. Here are the key rules every trader should be aware of:

• Flat 30% Tax: All crypto gains are taxed at a flat 30% rate, with no deductions or exemptions allowed.
• 1% TDS on Trades: A 1% TDS applies on transactions above ₹10,000, which must be reported in your ITR.
• No Loss Carry Forward: Losses from crypto cannot be adjusted against other income or carried forward.

For a detailed breakdown of India’s crypto tax limits and laws, check out our in-depth guide here.

Is There a Minimum Crypto Tax Limit in India?

No, there is no minimum tax-free limit for crypto earnings in India. 

Every rupee earned from crypto is taxable under the flat 30% rate, with no exemptions or thresholds. Even if your total earnings are small, 1% TDS may still apply on trades above ₹10,000. 

However, if your total annual income is below the taxable slab, you may not owe any additional tax after deductions.

Do You Need to Pay 30% Tax on Crypto Income Below ₹50,000?

Yes, all crypto income, whether ₹100 or ₹50,000 is subject to a flat 30% tax. 

There is no lower limit or exemption for small earnings. However, your total taxable income (including crypto and other sources) determines if you fall under the basic exemption limit. 

If your total annual income is below ₹2.5 lakh, you may not have to pay additional tax beyond TDS deductions.

How to Report Crypto Earnings Below ₹50,000 in Your ITR

Even if your crypto income is below ₹50,000, you must still report it in your Income Tax Return (ITR). Here’s how:

• Declare as Income from Other Sources: Crypto gains should be reported under “Income from Other Sources” in your ITR.
• Pay 30% Tax (If Applicable): If your total annual income exceeds the basic exemption limit (₹2.5 lakh for individuals under 60), you must pay a flat 30% tax on crypto earnings.
• TDS Credit: If 1% TDS was deducted on trades above ₹10,000, you can claim it as a tax credit while filing your ITR.
• Maintain Records: Keep track of all trades, profits, and TDS deductions to ensure smooth tax filing.

Exemptions, Loopholes, and Penalties: What Traders Must Watch Out For

In effect, there are no real loopholes. 

Every crypto transaction is either taxed directly (30% on gains) or indirectly (1% TDS on trades). 

To avoid penalties, make sure you calculate your tax accurately using the Mudrex tax calculator.

Final Thoughts: Should Small Crypto Traders Worry About Taxes?

Even if your crypto earnings are below ₹50,000, you cannot ignore India’s tax laws. The government treats all crypto gains as taxable, no matter how small. While there’s no exemption from the 30% tax, the real impact depends on your total income.

The key takeaway? Stay informed, keep records, and file taxes properly—even if your profits are small. The penalties for non-compliance are steep, and it’s always better to be safe than sorry.

Taxes can be confusing, but you don’t have to figure it out alone. Join the Mudrex Telegram Community to get expert insights, stay updated on crypto regulations, and connect with traders who share your journey.