TaxTMI 
TaxTMI 
TaxTMI 
Section 194S : TDS on payment on transfer of virtual digital asset
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....ll deduct tax at source. * (b) In case of exchange of VDAs, both payer and payee may be liable to deduct tax at source as the transfer of VDA happens from both sides. * (c) Where VDAs are transferred through an Exchange and payment to the seller is made directly by the exchange, In such cases, the exchange shall be liable to deduct tax at source. * (d) Where VDAs are transferred through an Exchange but the payment is made to the seller through a broker. In such case, both the Exchange and the broker shall be liable to deduct tax at source. However, if there is a written agreement between the Exchange and the broker that the broker shall be deducting tax on such payment, then such broker alone may deduct the tax. * (e) Where VDA bein....
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....od, the payer shall deduct tax at the rate of 1% (if the payer is a specified person) or 5% (if the payer is not a specified person) as per the Section 206AB. [ Section 206AB(1) ] * "Specified Person" means a person who has not furnished the return of income for the assessment year relevant to the previous year immediately preceding the financial year in which tax is required to be deducted, for which the time limit for furnishing the return of income under section 139(1) has expired and the aggregate of tax deducted at source and tax collected at source in his case is rupees fifty thousand or more in the said previous year. * A specified person is not required to apply or obtain a Tax Deduction or Collection Account Numb....
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....sideration is wholly in kind or in exchange of another VDA or partly in cash and partly in kind : Provided that in a case where the consideration for transfer of virtual digital asset is- (a) wholly in kind or in exchange of another virtual digital asset, where there is no part in cash; or (b) partly in cash and partly in kind but the part in cash is not sufficient to meet the liability of deduction of tax in respect of whole of such transfer, the person responsible for paying such consideration shall, before releasing the consideration, ensure that tax required to be deducted has been paid in respect of such consideration for the transfer of virtual digital asset. [ Proviso to Section 194S(1) ] Note:- Read with ....
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....ssion, during the financial year immediately preceding the financial year in which such virtual digital asset is transferred; * (b) not having any income under the head "Profits and gains of business or profession" ≤ Rs. 50,000 (ii) Any person other than specified person mention in (i) ≤ Rs. 10,000 * The provisions of sections 203A and 206AB shall not apply to a specified person. [ From 01.07.2022 to 31.03.2025 ] * The provisions of sections 203A shall not apply to a specified person. [ From 01.04.2025 Amended by Finance Act, 2025 ] * Section 194S(4) : TDS not to be deducted or collected under any other provisions * Notwithstanding anything contained in section 19....
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....orm for transfer of virtual digital assets, which matches buy and sell trades and execute the same on their application or platform; * Form:- the Exchange shall deliver or cause to be delivered, a quarterly statement of such transactions in Form No. 26QF to the Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems) or the person authorised by the Principal Director General of Income-tax (Systems) or the Director General of Income-tax (Systems). [ Proviso to rule 31A(1) ] * By any other person * Form :- the following quarterly statements to the DGIT (Systems) or the person authorised by the DGIT (Systems), namely:- * Statement of deduction of tax under sections 193 to 1....
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....after deducting fails to deposit the same, he shall be treated as assessee-in-default. In that case, interest under section 201 will be applicable. * If the deductor fails to deduct TDS, interest at the rate of 1% per month or part of the month shall be applicable, till such failure continues. Interest shall be calculated from the date when such tax was required to be deducted till the date such tax is actually deducted. * Further, if the deductor after having deducted the tax, fails to deposit the same to the credit of the Central Government, interest at the rate of 1.5% per month or part thereof shall be applicable till such failure continues. The interest computation shall commence from the date on which the tax was deducted and end ....