Explanation
Section 115BBH of IT Act 1961 (introduced Finance Act 2022, carried into IT Act 2025) taxes Virtual Digital Assets at 30% flat, regardless of holding period or the taxpayer's slab rate. Key rules: (1) Deduction only for cost of acquisition — no other expenses. (2) Loss from one VDA cannot be set off against profit from another VDA. (3) VDA losses cannot be set off against any other income. (4) Gifted VDA: taxable at FMV in recipient's hands on date of receipt (under §56(2)). (5) TDS: 1% under §194S on every VDA transfer above ₹10,000 (₹50,000 for specified persons). (6) Must report each transaction in Schedule VDA in ITR. (7) Mining income: taxable under 'Other Sources' at slab rates. Report in Schedule VDA of ITR-2/ITR-3. Verify on the income-tax portal before filing.