In India, cryptocurrency losses are not tax-deductible, as per the tax regulations under Section 115BBH of the Income Tax Act. Losses incurred in trading, transferring, or holding Virtual Digital Assets (VDAs), including cryptocurrencies, cannot be offset against any other income or gains, even from another cryptocurrency transaction.
For example:
If you profit ₹50,000 from Bitcoin but lose ₹20,000 on Ethereum, you cannot use the Ethereum loss to offset the Bitcoin gains. You will pay a 30% tax on the ₹50,000 profit.
Moreover, expenses related to crypto transactions, such as trading fees, electricity costs for mining, or infrastructure expenses, cannot be deducted except for the cost of acquisition.
Source: Shiraverse.com
