The Finance Bill of 2022 introduced a new section called 194S in the Income-Tax Act, 1961, to levy 1% TDS on any consideration paid for the transfer of Virtual Digital Assets (VDA). Crypto is considered a VDA.
When you complete a trade on WazirX, we deduct the TDS on your behalf and transfer it to the Income Tax Department in the form of INR.
TDS is applicable when you sell in the INR/Crypto market, buy/sell in the Crypto/Crypto market & sell in the P2P market. TDS is not levied when you buy in the INR/Crypto market.
Note: As per Section 206AB of the Income-Tax Act, 1961, if the user has not filed their Income Tax Return in the last 2 years and the amount of TDS is ₹50,000 or more in each of these two previous years, then the TDS to be deducted (for Crypto-related transactions) will be at 5%.
- To check the TDS deducted for a particular trade, you can go to your completed order history and select the trade. You'll be able to see the amount deducted as TDS.
- To check your entire history of TDS deduction, you'll have to download your trading report and visit the Exchange Trades section. (To download the trading report, open your WazirX account, Go to Account Settings > Download Reports > Trading Report > Enter the timeline > Request Trading Report).
In the above example, TDS is deducted in USDT. Later on, WazirX converts this USDT into INR and transfers it to the Income Tax Department.
- How to check TDS details on the Income Tax platform?
Visit https://www.tdscpc.gov.in/app/login.xhtml, log in using your PAN details and check the TDS details. If you are a new user, select Register as a new user.
Select View/Verify Tax Credit > Select View Form 26AS > Select Assessment Year > Select View/Download.
The TDS details for the trades done on WazirX will be visible under the Name of Deductor as Zanmai Labs Private Limited.
- What is the Total Amount Paid/Credited section under Zanmai Labs Private Limited in my Form 26AS?
The Total Amount Paid/Credited would be the volume of trades done on WazirX where TDS was deducted.
- The TDS deducted on WazirX is not shown in my Form 26AS?
For the trades done on WazirX, it can take up to 45-60 days after the financial quarter has ended for the details to reflect in your Form 26 AS.
- Would my Form 26AS show my profit/loss received while trading?
No, Form 26AS would only show you the volume of trades done on WazirX where TDS was deducted.