TDS ON SALE OR TRANSFER OF VIRTUAL DIGITAL ASSETS SUCH AS CRYPTO CURRENCIES ETC.

From 1st July 2022, New provisions have been introduced regarding TDS on payments made in respect of the sale/transfer of Virtual Digital Assets.

We will look into the same in this Article.

1.TDS of 1% has to be deducted by any person who pays any sum to a resident in respect of the transfer of Virtual Digital Assets.

TDS is to be deducted at the time of credit of such sum or at the time of payment whichever is earlier.

2. Even if there is no cash payment and there is an exchange of another virtual digital asset, TDS has to be deducted from the sale/transfer amount and the payer has to ensure that full TDS has been paid before releasing the consideration.

3. If the payment is made by a specified person, TDS has to be deducted from any sum paid in excess of Rs.50,000 during the financial year.

4. If the payment is made by a person who is not specified, TDS has to be deducted from any sum paid in excess of Rs.10000 during the financial year.

5. Specified Person has been defined as :

(i) In case of any Individual or HUF, if the total sales, turnover or gross receipts in business does not exceed Rs.1 Crore and in case of Profession it does not exceed Rs.50 lakhs during the previous financial year

(ii) Any Individual or HUF who is not having any income from business or profession