Crypto mining and tax in India (2026): what the rules say
What Indian tax law says about crypto and mining as of October 2026, which parts are settled, which are not, and what records to keep before you speak to a CA.
Published by Minevana · October 14, 2026 · 8 min read
The short answer
Crypto is not banned in India, but it is not legal tender and has no dedicated law. Income from transferring it, including selling coins you mined, is taxed at a flat 30% plus any surcharge and 4% cess, with 1% TDS and no set-off of losses. When mined coins are taxed, and at what cost, is not settled. Rules as checked in October 2026.
Is crypto legal in India in 2026?
It is not banned. In March 2020 the Supreme Court set aside the RBI's 2018 circular that had stopped banks from serving crypto businesses. In May 2021 the RBI told banks that circular is no longer valid and cannot be cited.
It is not legal tender. In February 2022 the Finance Secretary said Bitcoin, Ether and NFTs will never become legal tender, and that only the RBI's digital rupee would be.
It is largely unregulated. On 10 February 2026 the Finance Ministry told the Rajya Sabha that virtual digital assets (VDAs) and crypto assets are currently unregulated in India. They are covered for specific purposes: income tax, and since March 2023 the anti-money-laundering law, which made businesses that exchange, transfer or hold crypto for others register as reporting entities.
Paying tax on crypto does not make it legal or illegal. The CBDT chairman said in 2022 that the tax department looks at whether income is taxable, not whether the activity is legal. As of October 2026 there is still no comprehensive crypto law. Parliament's Standing Committee on Finance is studying VDAs; after the RBI gave evidence on 2 July 2026, the committee's chair told reporters the RBI was against legalising them.
Which tax sections apply: old Act vs new Act
The Income-tax Act, 2025 replaced the 1961 Act from 1 April 2026. The crypto rules carried over with new section numbers, so older guides that cite 115BBH and 194S still describe the same rules.
| What it covers | Income-tax Act, 1961 (to 31 March 2026) | Income-tax Act, 2025 (from 1 April 2026) |
|---|---|---|
| Meaning of "virtual digital asset" | Section 2(47A) | Section 2(111) |
| 30% tax on income from transferring a VDA | Section 115BBH | Section 194(1), Table Sl. No. 4 |
| 1% TDS on payment for a VDA transfer | Section 194S | Section 393(1), Table Sl. No. 8(vi); thresholds in Section 393(4), Table Sl. No. 12 |
| Crypto platforms reporting users' transactions | Section 285BAA (added by Finance Act 2025) | Section 509 |
The 1961 Act covers tax years up to the one ending 31 March 2026; the 2025 Act covers tax year 2026-27 onward. Section numbers checked against the Act text in October 2026.
How the 30% crypto tax and 1% TDS work
- Flat 30%, whatever your slab. Income from transferring a VDA is taxed at 30%, plus any surcharge that applies to your income and 4% health and education cess. This has applied since the 2022-23 financial year, and Budget 2026 left the rate unchanged.
- Only the cost of acquisition can be deducted. No other expense or allowance is allowed when working out this income. The 2025 Act's wording is "cost of acquisition, if any".
- "Transfer" is wide. The Act's definition of transfer, which includes sale, exchange or relinquishment, applies to every VDA. Selling for rupees, swapping one coin for another, and spending crypto can all count. That includes paying for a mining plan in crypto: if the coin you pay with has risen in rupee value since you got it, that gain may be taxable.
- 1% TDS on transfers. A person paying a resident for a VDA transfer deducts 1%. No TDS is needed if the payer's total for the year stays at or below ₹50,000 (when the payer is an individual or HUF with no business income, or with turnover of up to ₹1 crore for a business or ₹50 lakh for a profession) or ₹10,000 (any other payer).
- TDS is not an extra tax. It is credited against your final tax for the year, so match it with your annual tax statement before you file.
Can you set off crypto losses in India?
No. A loss from transferring a VDA cannot be set off against any other income, and it cannot be carried forward to a later year. In 2022 the government also confirmed in Parliament that a loss on one VDA cannot be set off against a gain on another.
A simple illustration: in one tax year you make a ₹50,000 gain selling one coin and a ₹20,000 loss selling another. Tax is worked out on the full ₹50,000, which at 30% is ₹15,000 before cess and any surcharge. The ₹20,000 loss does not reduce it and does not carry forward.
How are mined coins taxed in India?
Neither the old section 115BBH nor the new section 194 mentions mining, and we found no CBDT circular that deals with it. Here is what is settled and what is not.
Settled: selling mined coins is a transfer. When you later sell, swap or spend coins you mined, the 30% rule and the no-set-off rule above apply to the income from that transfer.
The government's stated view: mining infrastructure is not a cost of acquisition. In a written Lok Sabha reply in March 2022, the government said infrastructure costs of mining VDAs are capital expenditure and will not be treated as cost of acquisition, so they cannot be deducted from that income.
Not settled: when mined coins are taxed and what they cost. Tax lawyers writing in March 2022 said it was unclear how the 30% tax applies to mining. Practitioner guides still disagree. One says mined coins are taxed at your slab rate on their value when received, then treated as having zero cost when sold. Another says their value when received becomes the cost for the later sale. On the same coins, these give different tax bills.
Not settled: cloud mining plans. We found no official guidance on whether the price of a cloud mining plan counts toward the cost of the coins it produces. The 2022 reply was about mining infrastructure, not cloud mining contracts, so it does not answer this. Keep the paperwork and ask your CA.
Does GST apply to crypto mining?
We found no GST rule aimed specifically at mining rewards or at simply buying and holding crypto.
The GST cases made public so far have mostly involved exchanges. In December 2024 the Finance Ministry told the Lok Sabha that 17 crypto exchanges had been investigated for GST evasion of ₹824.14 crore, and four individual VDA investors for ₹1.76 crore. If you mine as a business, ask a CA whether GST registration applies to you.
What records to keep for crypto mining tax
- 1
Every coin you receive
Note the date, coin, amount, its rupee value that day and the transaction hash. Because the tax point for mined coins is unsettled, this lets your CA apply whichever treatment they advise.
- 2
Every sale, swap or spend
Note the date, amount and rupee value received. Since 2023 the income-tax return has had a separate Schedule VDA asking for the date of acquisition, date of transfer, cost of acquisition and consideration received. Forms for tax year 2026-27 under the new Act may change the layout.
- 3
What you paid
Keep invoices for mining plans, hardware and electricity, and records of any crypto you paid with. Some of these costs may not be deductible, but your CA still needs them to work out cost and any gain on the crypto you spent.
- 4
TDS and platform data
Check the TDS deducted on your transfers against your annual tax statement. A reporting duty for crypto platforms took effect on 1 April 2026, with its details in the Income-tax Rules, 2026. On 24 July 2026 the CBDT issued guidance on it, saying it adds no new tax; it follows the OECD's Crypto-Asset Reporting Framework, built for tax authorities to share crypto data, and the first statements, for calendar year 2026, are due by 31 May 2027. Expect the tax department to see more of your transactions than before.
- 5
If you mine with Minevana
Minevana sends payouts on request to the payout wallet saved on your account and records each one with an on-chain transaction hash that you can check yourself. Save each one with its date and rupee value on the day you received it. See how payouts work, and remember that mining income is variable and can come to less than you paid: read the risk disclosure.