In a peer-to-peer transaction, the buyer will be required to deduct tax under section 194S of the Income Tax Act, the CBDT said
TDS will be calculated on the price of the VDA without the goods and services tax in P2P transactions
FM Nirmala Sitharaman, in her Budget 2022 speech, had proposed a 30% tax on income from VDAs, including cryptocurrency, and 1% TDS on VDA transactions
Issuing another clarification on tax deduction at source (TDS) for virtual digital assets (VDA), the Income Tax department on Tuesday (June 28) said that the buyer of a VDA will be liable for deducting tax in a peer-to-peer transaction.
“Thus, in a peer-to-peer (i.e. buyer to the seller without going through an exchange) transaction, the buyer (i.e. person paying the consideration) is required to deduct tax under section 194S of the Act,” said a clarification from the central board of indirect taxes (CBDT).