Schedule VDA: How to Report Crypto in Your ITR

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.

Which ITR form

Reporting VDA income requires ITR-2 or ITR-3. ITR-1 (Sahaj) and ITR-4 (Sugam) do not accommodate Schedule VDA, so anyone who would otherwise file ITR-1 must move to ITR-2 in a year they have crypto income.

Form	Use when
ITR-2	You have VDA income and no business or professional income
ITR-3	You have business or professional income, or VDA activity assessed as business income

What Schedule VDA asks for

Schedule VDA requires transaction-level reporting rather than a single annual figure. For each transfer you report the date of acquisition, the date of transfer, the head under which income is taxable, the cost of acquisition and the consideration received.

That is the practical difficulty: it is a per-transaction schedule, and a year of active trading produces a long one. Every swap counts, including crypto-to-crypto trades where no rupees moved.

The reconciliation that matters

1. Download your full transaction history from every exchange you used, including ones you stopped using mid-year.
2. Pull your Annual Information Statement and Form 26AS from the income tax portal.
3. Match the TDS entries reported by exchanges against your own records.
4. Investigate any discrepancy before filing rather than after.

Indian exchanges report TDS under Section 194S, so the department already holds data about transfers you made on them. A return that omits transactions visible in the AIS is the most predictable way to attract a query. See responding to a crypto tax notice.

Foreign exchanges and foreign asset reporting

If you hold assets on an offshore platform, Schedule VDA is not necessarily the end of it. Resident taxpayers may also have obligations under Schedule FA (Foreign Assets), and the penalties under the Black Money Act for non-disclosure of foreign assets are severe and separate from ordinary income tax penalties.

Whether a particular offshore holding triggers Schedule FA is a fact-specific question that turns on the nature of the holding and the platform. It is worth specific professional advice rather than a general rule — the downside of getting it wrong is disproportionate.

Deadlines

The usual due date for individuals not subject to audit is 31 July following the end of the financial year, subject to any extension notified by the CBDT. A belated return can generally be filed later with a late fee under Section 234F, and interest under Sections 234A, 234B and 234C may apply to unpaid tax.

Preparing the transaction list

Because Schedule VDA is transaction-level, the preparation work is assembling a complete, accurate list before you open the form. For an active year this is the bulk of the effort.

1. Export the full history from each exchange, not just the current year's summary — you need acquisition dates that may fall in earlier years.
2. Include every crypto-to-crypto swap, each of which is a transfer requiring its own row.
3. Convert values to INR at the appropriate date for anything denominated in USD or another currency.
4. Apply a consistent cost basis method across the whole list.
5. Reconcile the resulting TDS total against Form 26AS before you start filing.

Common filing errors

• Reporting a net annual figure instead of per-transaction rows.
• Omitting swaps because no rupees were involved.
• Using the wrong acquisition date for assets bought in an earlier year.
• Claiming deductions beyond cost of acquisition, which Section 115BBH does not permit.
• Filing ITR-1, which has no Schedule VDA and produces a defective return notice.

Keeping records through the year

The single change that makes filing manageable is recording as you go. A ledger with date, asset, quantity, INR value, counterparty platform and transaction reference — maintained monthly — turns filing from reconstruction into transcription.

Exchanges also do not keep history indefinitely, and accounts can be closed or restricted. An export taken each quarter and stored independently protects against losing the underlying evidence entirely.

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.