Income Tax Department collects TDS of more than Rs. 700 crore from Online Gaming and Crypto Trading

The government has collected more than Rs. 700 crore in taxes so far this financial year after implementing a new TDS regime for online gaming and cryptocurrency trading, according to CBDT Chairperson Nitin Gupta on Friday.

About Rs. 600 crore in taxes (under the tax deduction at source head) were collected during the current financial year after the new online gaming regime went into effect, while around Rs 105 crore through TDS was collected during the 2023-24 financial year after the cryptocurrency taxation regime went into effect on April 1 last year, he told reporters.

With effect from April 1, 2023, the Finance Act 2023 inserted a new section 194BA in the Income Tax Act, 1961, requiring online gaming platforms to deduct TDS on net winnings in the person’s user account. Tax must be deducted both at the time of withdrawal and at the end of the financial year.

Similarly, beginning April 1, 2022, income from the transfer of virtual digital assets or cryptocurrencies is taxed at 30%.

Such income is taxable even if the taxpayer’s total income is less than Rs. 2.50 lakh, and no deduction other than cost of acquisition is allowed when calculating the taxable amount.

Earnings from these two industries – online gaming and cryptocurrency trading must also be reported by taxpayers when they file their individual income tax returns.