Ever since I began writing and sharing about the environment surrounding cryptocurrencies in India; people ask me on daily basis about Income Taxes surrounding cryptos and possibility of running into an issue with the I-T department in India.
The fact is that there's not a lot that I-T department can do other than behaving like thugs and coming after your hard earned crypto savings in an aggressive manner. Their notice to HNIs investing in cryptos from India had a number of points that can be considered an invasion of privacy and the right to earn a legitimate income-atleast in my opinion. There maybe bad actors for sure trying to scam people of their money, but then that's just a tiny % of the users in this domain.
Over the past couple of weeks I've discovered from my sources that those who have received these notices have drafted their responses to the I-T department. However, a few have drafted responses similar to that reported by ET.
People are claiming not to have owned any crypto, or that their wallets were hacked, or the crypto they en-cashed was a consulting income they received overseas or income received for freelancing. These are some of the responses I've heard. I'm not against paying income tax and infact I have been doing this for years and in the last few I've declared my gains from any crypto sale.
However, the fact that the government chooses to go aggressively after crypto investors while ensuring no regulations are in place to protect interests of investors from India has many fuming, myself included. The obvious knee-jerk reaction is that people will evade paying taxes to prevent the government from ripping them off by forcing heavy taxes on investments without a proper policy in place.
If the government drafts a proper framework legalising cryptocurrencies in India, many of these issues are likely to fade away with time and I'm sure many users may be willing to come forth and pay the taxes due. The tax department sent notices to 500,000 HNI's demanding answers to over 20 tough questions. It is nothing short of harassment by the government agency tasked with the job of ensuring people pay their taxes.
India is a land full of direct and in-direct taxes and in such a scenario where we pay taxes through our nose. People are unlikely to bend over backwards and oblige just because a government rooted in corruption demands us to reveal all the information about our wealth.
The banks are also hand-in-glove with the government when it comes to charging exorbitant fees to their customers.
On the bright side, there is no ban on crypto sale/purchase nor do the exchanges here have any restrictions other than mandatory KYC of all their clients.
I close this post by sharing something a friend shared on my FB wall:
In India:
Putting money in Bank: KYC Required.
Putting money in MFs: KYC Required.
Putting money in Online Wallets: KYC Required.
Putting money in Political Parties:
KYC NOT Required.
(Know your Clever) Politicians.
This is the current state of affairs in India and more the reason why we need a crypto revolution. In the meantime, dont panic and know your rights. File your returns and have a good auditor assist you in the same. Read my report in TheQuint on how to file your taxes to account for any crypto-gains. Good luck!
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https://drive.google.com/file/d/1xcC1DPY_6IZevRMAeAyDZ_Aa1lb2xzoZ/view
Whoa! Thank you for pointing me to this. Will look into this in greater detail! :D
This is the kind of response that needs to go out!
I just love reading that response to the officials. That's exactly the stand that should be taken.
Thanks for this informative post I think government shouldn't come after minnows who try to make their ends meet my trading a few cryptos & doing some freelance work. They already failed miserably to provide jobs for the youth, there is no way government can track gains on cryptos and tax will come to picture only when it is withdrawn to bank account.
Government should go after people who are trying to send a large amount of money out of India as cryptos but again they will have enough money to fight this legally. I pay my taxes even though they loot me and don't utilize it properly. If Government is envy of crypto growth then they should collaborate wit crypto companies, for example CIVIC project will be better than AADHAR which is a mess with privacy of people. The government which is open to blockchain & cryptos will boom!
Government should (perhaps) regulate weights and measure. And (perhaps) provide for a collective enforcement of contracts. Other than that, it is nothing but a leech, bloodsucking, self-serving encroachment upon free individuals transacting freely in free markets to gain above-market returns for themselves and their cronies by enforcing monopolies.
It is very kind of you dude.
Thanks for upvote
God bless you.
I am also afraid of now to convert my cryptos back to INR. I am a freelancer and paying heavy taxes here is not any good for me. First proper laws should be implemented, then we can pay taxes accordingly. Resteemed your post for better reach. Keep on sharing these wonderful and hard to get articles about cryptos on India.
Find cash business owners you can trust that want to invest in crypto.
Convert your crypt to whatever they want; I usually recommend transactions in LTC or ETH for speed.
If you have to, show them how to use a wallet too..
In India no exchange accepts other than ETH or Bitcoin, so it is really difficult to exchange here.
As always a wonderful post Meghan. Well, it is pitty how things work up here but then I feel we are still better if I hear what’s happening around. India is developing and you know how scams and black money hovers like dark clouds in our country. I hope soon the govt. comes with some kind of framework to curb all these issues. Right now there are other fishes to fry for them as I saw aadhaar bank connection and mobile connection is not not yet resolved. Moreover the impacts of demonetisation and confusion over GST still surrounds 😂😂
I dont know why government is so silent when SBI looted 1100 crores of the hard earned money from the people in the name of 'zero balance'.
Thanks for good post. We should pay tax but should not fear from IT department.
Thanks for info @firepower ..tax matters are very confusing in india
Specially in india
Politicians are a joke bro.. It's the biggest reality show put on by fucking puppets.
The real bosses are always hidden. :)
Nice currency
money transfer make money
The problem here is that we cant all think in same direction
Wow,,,amazing post,, good job and good luck.
it would be so hard for them to have any tangible impact and effect, the question is how would the govt prove i own crypto.
If you need other information about of cryptocurrecy, visit my blog @akubaihaqi
excellent post dear friend @firepower, the Indian is very similar to my country Argentina, which is persecuted people who earn honestly our money, regardless of what we dedicate ourselves, however politicians can steal a whole country and nobody judges.
All the problems that exist in the world will be fixed when the politicians or rulers of the day receive a canon.
Thank you very much for sharing this information and your reflections
I wish you a wonderful weekend
There is nothing that can stop the rise of cryptocurrency in the world today. The Indian government is only doing this out of fear of loosing control. However, sooner or later they would have to come to the realization that decentralized system has come to stay for good
I'm often thinking about the same thing but obviously in my country. I'm pretty new at cashing out crypto @firepower . I mined some in 2103 and spent it here and there but never had reason to cash out. As it stands I believe I would use coinbase to cash out to US dollars and I assume it will be pretty easy to tax me.
Politics is d same no matter where om turns.
India government just found another avenue to generate more revenue for their selfish self.
The situation is the same in the USA. The laws aren't very clear on how things are to be taxed and how much. One of the things that irks me is that if you buy something with Bitcoin, the govt considers it a sale of the Bitcoin and sebsequent purchase of the item. It should just be a straight trade. Therefore, you would still pay sales tax, but you wouldn't pay income tax on it as well.
Yess. Good information. This be reference for me. I writed about bitcoin-cash, please visit my blog @akubaihaqi
Thank you for information nice post @firepower
Useful information for everyone who have cryptocoin.
Do not use cryptocoin without full knowledge about it.
Indian government lol cryptocurrency will forever be there
Because you are savage 💪
I like the information
as usual such a really wonderful post thank you for this informatve post we all know that india is a well developed country thank you again
Nice post bro. Thanks for sharing.
Nice post...but let's come to think of it, can there actually be tax payments on cryptocurrencies??? That sounds really ridiculous to me....so India is a country full of corruption too?? Nigeria's counterpart,anyway thanks for d information...
Rightly pointed out buddy, with proper policies in place we won't mind paying in come tax but,no consideration towards protection of interests of investors along with harassment make people vary and make them hide facts.
Though I think we can study what other countries have done and recommend same through proper channel (if it exists and taken sportingly) to the government
Super nice
If this statement is true : "Putting money in Online Wallets: KYC Required."
Why not having a paper wallet for all your crypto :) . It is ridiculous and crazy how corrupt gov. around the globe are trying to use fear against something virtual. I can only sit and laugh, nothing else. It is like trying to take overflying tax from a bird.
Political parties collectively decided to keep the funding of their coffers out of the purview of RTI. You may ask us but don't ask us.
These high flying arrogant IAS babus who decide our policies, what we should eat-how much should we pay-and how much should we earn never disclose their own incomes.
http://m.businesstoday.in/story/ias-officers-assets-have-not-filed-asset-details-govt/1/258159.html
Now when general public is making money, at their own risk, by investing in crypto they are naturally outraged.
How dare these minions do something without we telling them how to do it?
They celebrated GST and demo like they had won the Mahabharata but look at what's happening. Demo was a political.move and it only helped the ruling party to kill funding of other political parties and thus the results in UP elections turned out the wah they did.
What a bunch of thugs we've chosen to rule us.
In my country there is a similar case, but more serious because it is chasing people not only to pay taxes, initially the management of Cryptomonedas was illegal... seizing and seizing equipment mining and all... then the Government accepted the use of Crytomonedas Even taking out one's own (so far you see that will be a failure), perp follow the persecution of the police and National Guard, they hunt down the miners to steal the machines for their personal use.
I am all for paying taxes but however do agree that the way what is currency happening in asking the citizens on their obligation to pay taxes could do better
Very true, yes in India to keep money in the banks kyc required, but polical system have enjoyed every right to hold case any where without any kyc. Our country is a democratic but fake and hollow internally. But friend thanks for sharing this, you are a great hope and help for me. Your every appreciation and suggestion are treasures for me. I am a follower of your way, wish you a very beautiful time ahead.
Resteeming this post. I like this part:
"I close this post by sharing something a friend shared on my FB wall:
In India:
Putting money in Bank: KYC Required.
Putting money in MFs: KYC Required.
Putting money in Online Wallets: KYC Required.
Putting money in Political Parties:
KYC NOT Required.
(Know your Clever) Politicians.
This is the current state of affairs in India and more the reason why we need a crypto revolution. In the meantime, don't panic and know your rights. "
I can understand your frustration, but happy that people like you will pave the path to handle such situations when I or many like me start earning big money with crypto.
Governments across world will sooner or later realise that they have to coexist with crypto. Sooner the better
I would like to thank you for this informative post we all know that india is a well developed country with a very strong economy..Thank you again for sharing..
@firepower - the Indian Government reeks of hypocricy and a lack of fairness in that they want to ensure they get a big slice of the profit pie
gained by investors and commoners after taking considerable risk in crypto while not providing them with any regulation or framework or providing any kind of protection.
In this case the goverment is having its cake and eating it too..
Unfortunately, as a citizen you simply can't do much about laws. To be honest, while I too want a regulation framework in place, my gut instinct is that the government is unlikely to create anything that is even remotely fair to an average man. Banks obviously will be hand in glove with the government because they would get to lose if individuals moved money from their system to a parallel ungoverned peer-to-peer system.
Thanks for your insights and will be following to hear more of your insights on this rather dicey topic.
Nic
Very informative post on I-T Notice to Bitcoin HNIs in India! It will really help all Indian HNI's and I will share it with others HNI's I know. Upvote for you and wish you a great year ahead.
Hey @firepower. What do you use to keep records of your trades? I find that some exchange trade sheets do not keep track of fiat amount, which is impossible to recall profit/loss later. Only recently started to keep some detailed records but keeping track is extremely painful. Thanks.
Hello firepower,
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You are so right! The politicians in our country are just misusing their powers. More than half of every party's source of Fund and Income is unknown, they are not supposed to pay taxes nor report their money flow!
Nic king
Great post
Have you heard about the India own cyprtocurrency which is said to be launched in March named Laxmi Coin ..I thought of sharing this here since may be there is future of crypto in India but as per govt. needs
Have a read at this >> https://steemit.com/cryptocurrency/@abhin/what-is-laxmicoin-possibly-the-first-legal-indian-cryptocurrency
Thanks for sharing, i need your upvote my blog @firepower