Gifting cryptocurrency has become increasingly popular as digital assets like Bitcoin, Ethereum, and NFTs gain mainstream attention. However, while gifting crypto might feel like a casual transaction between friends or family, the Indian tax authorities have clear rules for how such gifts are treated.
In India, cryptocurrency and other virtual digital assets (VDAs) are classified as capital assets under the Income Tax Act. The rules for taxing crypto gifts vary depending on who is giving the gift, its value, and how the recipient handles the asset after receiving it.
Understanding how taxes apply when you give or receive crypto gifts can save you from unexpected liabilities later. In this guide, we will explain the complete tax treatment of crypto gifts in India, including when you need to pay tax, how much you owe, and what steps you must take to stay compliant.
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Taxation on Crypto Gifts in India
Crypto gifts may seem simple, but their taxation depends on several factors. Whether you are receiving or later selling the gifted crypto, different tax rules apply. Let us break it down clearly:
Giving Crypto as a Gift
Giving crypto as a gift is treated as a disposal under Indian tax laws. If you have made a profit compared to your original purchase cost, you are liable to pay capital gains tax. The capital gain is taxed at a flat 30% rate plus a 4% health and education cess. No tax applies if there is no gain at the time of gifting.
Receiving Crypto Gifts Below INR 50,000
If the total value of all crypto gifts received during a financial year is less than or equal to INR 50,000, no tax applies. You do not need to pay any income tax, and you are not required to report it separately in your tax return.
Receiving Crypto Gifts From Relatives
Gifts received from specified relatives, such as parents, siblings, or spouse, are fully exempt from income tax, regardless of the value. Even if the value exceeds INR 50,000, no tax applies when the gift comes from a relative as defined by the Income Tax Act.
Receiving Crypto Gifts on Special Occasions
Crypto gifts received on special occasions like marriage, through inheritance, or under a will are also exempt from income tax. In these cases, the value of the crypto gift does not matter — it is entirely tax-free in the hands of the recipient.
Receiving Crypto Gifts Above INR 50,000 From Non-Relatives
If you receive crypto gifts worth more than INR 50,000 in a financial year from non-relatives, the entire value of the gift becomes taxable. It must be reported under “Income from Other Sources,” and you must pay income tax based on your applicable slab rate, which can range from 0% to 30%.
Disposing of or Selling Crypto Gifts
When you later sell, swap, or spend the crypto gift, you are liable to pay capital gains tax. The profit earned is taxed at a flat rate of 30%, plus a 4% health and education cess. The holding period is counted from the date the giver originally acquired the crypto, not from the date you received it.
Note: Whenever you are disposing of your crypto gifts of over INR 10,000 (INR 50,000 in some cases), the buyer will deduct a TDS of 1% on the sale price.
Read More: Ultimate Guide on Crypto Tax in India
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How To Calculate Crypto Gift Tax in India?
Calculating taxes on crypto gifts involves two important stages. You need to determine the tax at the time of receiving the gift and again when you eventually sell or swap the gifted asset. Let us break it down step-by-step:
Tax on Receiving Crypto Gifts
When you receive a crypto gift, first check the total value of all crypto gifts received during the financial year. If the value exceeds INR 50,000 from non-relatives, the entire amount becomes taxable under “Income from Other Sources.”
Here is the simple formula:
Taxable Income = Number of crypto received × Fair Market Value (FMV) of Crypto on Receipt Date |
You must add this amount to your total taxable income and pay tax according to your slab rate, which can range from 0% to 30%.
Example
In April 2024, Neha received a gift of 300 Solana (SOL) tokens from a non-relative. On the date of the gift, the fair market value of 650 SOL tokens was INR 80. Since the gift came from a non-relative, it was not exempt from income tax, and Neha did have to report it as taxable income.
| Taxable Income = 650 × INR 80 = INR 52,000 |
She needs to report this INR 52,000 as “Income From Other Sources” when filing her ITR.
Read More: How To Pay 0 Tax on Crypto Income in India?
Tax on Selling Crypto Gifts
When you later sell or use the gifted crypto, you must calculate your capital gain. For this, you need the original purchase cost and acquisition date of the giver, not the date when you received the gift.
Here is the formula:
Capital Gain = Sale Price – Original Purchase Cost by the Giver |
The capital gain is taxed at a flat 30%, plus a 4% health and education cess. If there is no gain, there is no capital gains tax liability.
Example
Later, in January 2025, Neha decided to sell all her 300 SOL tokens. At the time of sale, the market price of 1 SOL token had risen to INR 120. The total selling price was:
Selling Price = 300 × INR 120 = INR 36,000 |
The original purchase price, as per the giver’s records, was INR 50 per token. So, the original cost was:
Original Cost = 300 × INR 50 = INR 15,000 |
Now, to find the capital gain:
Capital Gain = Sale Price – Original Cost |
Capital Gain = INR 36,000 – INR 15,000 = INR 21,000
Neha’s capital gain of INR 21,000 is taxed at 30%, along with a 4% health and education cess:
- 30% of INR 21,000 = INR 6,300 (Capital Gains Tax)
- 4% Cess on INR 6,300 = INR 252
Thus, Neha’s total tax liability becomes:
Total CGT = INR 6,300 + INR 252 = INR 6,552 |
Additionally, the crypto exchange would deduct 1% TDS on the sale value of INR 36,000, which is:
TDS = 1% of INR 36,000 = INR 360
Neha can claim this TDS amount while filing her tax return, if she does not have any tax liability.
Read More: Calculating Capital Gains Tax on Crypto
How Can KoinX Help With Crypto Gift Tax in India?
Tracking crypto gifts and calculating taxes manually can quickly become overwhelming. KoinX helps by automating your tax calculations and making compliance much easier. Here’s how it supports crypto gift taxation:
Accurate Preview of Capital Gains
KoinX provides a precise preview of your potential capital gains before you decide to sell gifted tokens. This helps you understand your tax liability early, plan your disposals smartly, and avoid surprises during tax filing.
Auto-Classification of Transactions
Whether you are receiving a gift or selling gifted crypto, KoinX automatically classifies your transactions correctly. This ensures that each crypto gift is recorded properly under income or capital gains, saving you from manual sorting and errors.
Reliable Tax Reports
KoinX generates detailed tax reports that include all your gifted crypto transactions. These reports can be used directly for filing your Income Tax Return or shared with your tax consultant, ensuring complete and accurate compliance.
Portfolio Insights
With KoinX, you can track your entire crypto portfolio at a glance, including gifted assets. It provides valuable insights into your holdings, market values, and potential tax impacts, helping you make better financial decisions year-round.
Simplify your crypto gift taxes and stay compliant with confidence — join KoinX today!
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Conclusion
Crypto gifting can be a rewarding experience, but it is important to stay aware of the tax obligations that come with it. Whether you are receiving tokens from friends, family, or selling them later, each transaction needs to be reported correctly under Indian tax laws.
If you want to handle your crypto gift taxes with ease, KoinX is the perfect solution. Join KoinX today and experience a simpler, faster way to manage your crypto tax obligations.
Frequently Asked Questions
Is There A Limit On How Many Crypto Gifts I Can Receive In A Year?
There is no limit on the number of crypto gifts you can receive in a year. However, if the total value of gifts from non-relatives crosses INR 50,000 during the financial year, the entire amount becomes taxable as “Income from Other Sources” under Indian tax laws.
Are Gifts Received From Foreign Relatives In Crypto Taxable?
No, gifts received from foreign relatives are not taxable in India, regardless of their value. Relatives include parents, siblings, spouse, and a few others as defined under Indian tax laws. However, you must still keep clear records of such gifts for proper reporting if required.
What Happens If I Receive Crypto Gifts From Multiple Friends?
If you receive multiple crypto gifts from non-relatives and the combined value exceeds INR 50,000 during a financial year, the entire value becomes taxable. You must report it under “Income from Other Sources” and pay income tax according to your applicable slab rate.
Is A Crypto Gift Received On My Birthday Tax-Free?
If the crypto gift is received on your birthday from a relative, it is fully tax-exempt. However, if it is received from a non-relative and the total value of all such gifts exceeds INR 50,000 in a financial year, the entire amount becomes taxable as income.
Can I Claim Any Deductions On Crypto Gifts Received?
No, you cannot claim deductions for gifts received in cryptocurrency. The full fair market value of the gift must be reported if it crosses the INR 50,000 limit from non-relatives. Only gifts from relatives, on marriage, inheritance, or death, are tax-exempt.
