I was just going through ETF taxes and that's when this crossed my mind.
Currently bitcoin has a flat tax slab of 30% which we can't escape legally.
But what if we buy and hold/trade bitcoin ETF as per our individual needs to avoid the huge tax burden.
For people who know they are just holding bitcoin for monetary gains and will be selling it in the future or trading on daily basis, they can use this option.
Currently we have the option to buy bitcoin ETFs only through platforms like INDmoney, Vested Finance etc...
Bitcoin ETFs in India are classified as unlisted foreign securities for Indian tax purposes.
They are currently taxed under our Income Tax slab for STCG if held for less than 24 months and for LTCG its a flat 12.5% tax on the gains.
So instead of paying the 30% flat tax on bitcoin gains isn't it better to pay 12.5% instead under LTCG ?
For STCG depending on the annual income there would be 0 tax if annual income is under 12 lakhs and respectively according to the tax slabs.
But yeah, one disadvantage of this option is that margin trading, leverage and short selling is prohibited from RBI under the Liberalised Remittance Scheme (LRS).
This is strictly for those people who wants monetary gains from bitcoin investment.
This not for those who wants to hold the keys to their bitcoins.
Spill your thoughts below.
|
