3 weeks ago
2026 ITR Season Exposes Crypto Investors' Tax Reporting Gaps
In India, people who buy or sell cryptocurrency have to tell the government about it when they file their taxes.
The government takes a small part of the money from these trades in advance, called TDS.
Many people thought that once this money was taken, they were done with their taxes.
But that's not true — they still need to file an income tax return.
A tax expert named Punit Agarwal says only about 21 out of every 100 people who had this money taken actually went on to file their returns.
When people don't file, they might owe more tax, or they might miss getting a refund of the money that was taken from them.
Fortunately, people who missed the first deadline can still file a belated return, though they might have to pay a late fee.
There are different forms for different situations — one for regular investors and another for people who trade a lot.
All crypto income, like rewards for holding coins or free coins from airdrops, must be reported in a special section called Schedule VDA.
If they file properly, investors can still get their TDS refunds back.
Only 21.83% of KoinX users who had TDS deducted went on to file their crypto taxes this season.
TDS under Section 194S is an advance tax collection and does not replace mandatory ITR filing.
Investors who missed the deadline can file belated returns under Section 139(4), which may attract interest and late fees.
Crypto income must be reported in Schedule VDA, including buy/sell trades, staking rewards, airdrops, and crypto received as payment.
TDS refunds can still be claimed with a belated return if the return is filed correctly and Schedule VDA is completed.
- Who
- Crypto investors in India and Punit Agarwal, Founder & CEO of KoinX
- What
- The 2026 ITR season revealed a major compliance gap, with most crypto investors who had TDS deducted failing to file crypto tax returns
- Where
- India
- When
- 2026 ITR filing season; ITR-2 regular deadline ended 31 July, ITR-3 non-audit deadline is 31 August, and belated returns are due by 31 December 2026
- Why
- Many investors mistakenly believe TDS deduction completes their tax obligations, leading to under-reporting of income and missed TDS refunds
Key facts
- Crypto investors filing rate
- Only 21.83% of KoinX users with TDS deducted filed crypto taxes
- TDS legal basis
- Section 194S
- Belated return provision
- Section 139(4)
- Reporting schedule
- Schedule VDA
- ITR-2 deadline
- 31 July (regular); 31 December 2026 (belated)
- ITR-3 deadline
- 31 August for non-audit cases; 31 October for tax audit cases
- KoinX CEO
- Punit Agarwal
Quotes
Punit Agarwal
Founder & CEO of KoinX
“According to Punit Agarwal, Founder & CEO at KoinX, TDS is only an advance collection of tax under Section 194S and does not replace the requirement to file an income tax return or report crypto income.”
livemint.com
“He says taxpayers can still claim eligible TDS refunds even while filing a belated return, provided the return is filed correctly and Schedule VDA is duly completed.”
livemint.com








