Crypto gifting is legal in India, tax rules apply

Crypto gifting is legal in India, according to CoinDCX finance head Pranav Pagaria. Virtual digital assets are recognised under the tax framework. Gifts from specified relatives, such as spouses, parents, children, and siblings, are fully exempt from tax. Gifts from non-relatives are taxable if the aggregate value exceeds Rs 50,000 in a financial year. The entire amount, not just the excess, becomes taxable as income from other sources at the recipient's slab rate.

When an exempted crypto gift is later sold, the donor's original purchase price becomes the cost of acquisition for the recipient. For a taxable gift from a non-relative, the fair market value on the date of the gift is the cost. Taxable gains on crypto sales are charged at 30 per cent plus surcharge and cess. The buyer deducts 1 per cent TDS, which can be claimed as credit.

Both parties must keep exchange statements, wallet records, gift deeds, and valuation proof. Gifts held on foreign platforms require disclosure under Schedule FA in income tax returns. The ITR framework mandates transaction-wise reporting of virtual digital assets under Schedule VDA.