Answer

ITR

Crypto gains and the ITR form

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  1. Facts

    Crypto gains are reported in Schedule VDA. Investors use ITR-2; those treating it as business use ITR-3. ITR-1 and ITR-4 cannot be used.

  2. Provisions and law

    • Sec 115BBH, Income-tax Act 1961 (now Sec 194, Income-tax Act 2025)Income from virtual digital assets taxed at 30%.
    • Rule 12, Income-tax Rules 1962 (now Rule 164, Income-tax Rules 2026)Prescribes the ITR forms and who must use which form.

  3. Analysis

    Report each transfer with cost and sale value. Losses cannot be set off against other income. Claim 1% TDS. Choose ITR-2 or ITR-3 based on your activity.

  4. Conclusion

    1. Get exchange reports.
    2. Compute gains per transfer.
    3. Choose ITR-2 or ITR-3.
    4. Fill Schedule VDA.

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