Odaily News According to Indian Finance Minister Nirmala Sitharaman in her 2025 Union Budget announcement, cryptocurrencies will be included in Section 158B of the Income Tax Act for reporting undisclosed income.
The amendment allows for unreported cryptocurrency gains to be assessed en masse, giving them the same tax treatment as traditional assets such as currency, jewelry and gold bars.
Under the new amendments, cryptocurrencies will fall under the definition of virtual digital assets (VDAs), which state:
“Under the existing definition of virtual digital assets, crypto assets have been defined in section 2(47A) of the Act […] Reporting entities will be required to provide information on crypto assets under section 285BAA of the Act.”
In a signal of concern for cryptocurrency holders, Indian authorities may impose tax penalties of up to 70% on previously undisclosed cryptocurrency profits.
According to the document, the penalty could apply to undisclosed crypto gains up to 48 months after the relevant tax assessment year, reading: “70% of the total tax and interest payable on the additional income disclosed in the updated income tax return [ITR].”