As we all know whenever you buy crypto with INR or sell your cryptocurrency for INR you are required to pay 1% TDS. If you miss it or forget to pay it then you need to pay a fine. From April of 2023, this law has changed and the new law that comes into effect says that if you do not pay the TDS in time you will get a jail term of a minimum of 3 months to a maximum of 7 years.
Do remember you need to pay 1% TDS for every INR transaction involving cryptocurrency!
Most local exchanges have already implemented a system wherein every time there is a purchase made with INR or sell is done for INR, a 1% TDS is deducted. If you are using a local exchange then you need not need to bother about this law.
Who will be affected by this new law?- If you are, who is using the P2P service of a local exchange for buying & selling in INR then you need to make that payment on time.
- If you are using cash to buy/sell or using a wallet payment network then you are on the radar of this government.
- If you are using an international exchange and not trading with an Indian resident then this law is not applicable (check with your CA for clarity).
- If you are trading on an international exchange with an Indian citizen then this law will be applicable.
There is much information that is still not clear about trading on international exchange for now. We can expect a crypto regulation before April of 2023 for more answers I am just guessing it!
P.S -This my understanding and I am not a crypto legal expert. If anyone here is then please share your views.