Crypto Tax for NRIs in India

India taxes income from Virtual Digital Assets under Section 115BBH of the Income-tax Act 1961, introduced by the Finance Act 2022 and effective from Assessment Year 2023-24.

The rate is a flat 30% plus applicable surcharge and 4% cess, regardless of your income slab. A separate provision, Section 194S, requires 1% TDS on the transfer of a VDA, in force since 1 July 2022.

Residential status decides almost everything

For Indian tax, what matters is not citizenship but residential status under Section 6 of the Income-tax Act, determined year by year on day-count tests.

Status	What is taxable in India
Resident and Ordinarily Resident	Global income, including crypto on foreign platforms
Resident but Not Ordinarily Resident	Indian income, plus foreign income from a business controlled in or profession set up in India
Non-Resident	Income received in India, or accruing or arising in India

The broad test is 182 days in India in the financial year, or 60 days in the year combined with 365 days across the preceding four years — with modifications for Indian citizens leaving for employment and for those with Indian income above a specified threshold. The rules also include a deemed-residence provision for certain Indian citizens not liable to tax elsewhere.

Because the tests are mechanical but have several modifications, and because status can change year to year, the first step for any NRI is establishing status for the specific year in question rather than assuming continuity.

What is taxable for a non-resident

A non-resident is taxable in India on income received in India or accruing or arising in India. Gains on an Indian exchange fall within this; those on a foreign platform, for a genuine non-resident, generally do not.

Where VDA income is taxable in India, Section 115BBH applies at 30% in the same way as for residents, and the no-set-off rule applies equally.

TDS for NRIs

Section 194S applies to transfers on Indian exchanges. Separately, Section 195 governs TDS on payments to non-residents generally, and which provision an exchange applies can depend on how it has classified the account. Where excess TDS is deducted, a refund is claimed by filing a return.

Double taxation

If you are tax resident in another country, that country may also tax the same gain. India has Double Taxation Avoidance Agreements with many jurisdictions, which allocate taxing rights and provide relief mechanisms.

How a DTAA applies to crypto gains specifically is not always settled — most treaties predate VDAs and do not name them, so the analysis turns on which article the income falls under. This is genuinely specialist territory; an NRI with material crypto gains should take advice in both jurisdictions rather than relying on a general reading.

Practical points

• Establish and document residential status for each financial year separately.
• Keep records showing where you were resident when each gain was realised.
• Check whether an Indian exchange has applied Section 194S or Section 195 to your account.
• An NRO or NRE account classification affects repatriation, which is a separate question from taxability.

The year you change status

The hardest cases are transition years — the year you leave India or return to it. Status is determined for the whole financial year on day-count, so a mid-year move can leave you resident for a year in which you spent most of your time abroad, or the reverse.

Because that determination decides whether your foreign platform activity is taxable in India at all, it is worth establishing carefully rather than assuming. Keep passport stamps, travel records and employment documentation for any year in which you moved.

Returning NRIs and the RNOR window

An individual returning to India after a long period abroad may qualify as Resident but Not Ordinarily Resident for a limited number of years. During that period, foreign income not derived from a business controlled in or profession set up in India generally remains outside the Indian net.

For someone returning with substantial crypto holdings on foreign platforms, the RNOR window can be significant, and understanding when it ends matters for planning. The conditions are specific and the window is limited — this is worth mapping out with an adviser on return rather than discovering afterwards.

Practical documentation for NRIs

• Day-count records for each financial year, supported by travel evidence.
• Tax residency certificate from the country of residence, where a treaty position is relied on.
• Records showing where you were resident when each gain was realised.
• Separate records for Indian-exchange activity and foreign-platform activity, since they are treated differently.

An NRI using an Indian exchange should also confirm how the platform has classified the account, because it determines which TDS provision it applies and therefore what appears in Form 26AS.

Related guides

• Crypto tax in India: the complete guide
• Crypto tax calculator for India
• Tracking crypto for Indian tax records
• Best crypto exchanges in India

This page is educational and not tax advice. Indian tax law changes and individual circumstances differ. Confirm your position with a qualified chartered accountant before filing.