While digital currencies become more popular and people opting the same, the income tax department has come out with detailed disclosure requirements for TDS deductions for virtual digital assets.
According to the notification, date of transfer and mode of payment will also have to be specified.
From July 1, tax deducted at source (TDS) of 1 percent will be levied on payments towards virtual digital assets or cryptocurrencies beyond Rs 10,000 in a year, as the Finance Act, 2022 has introduced Section 194S in the I-T Act.
In the run-up to the implementation of the new provision, the Central Board of Direct Taxes (CBDT) on June 21 notified certain amendments in I-T Rules with respect to furnishing TDS returns in Form 26QE and Form 16E.
CBDT has notified that the TDS collected under Section 194S shall be deposited within 30 days from the end of the month in which the deduction has been made. Deposit of tax so deducted shall be made in the challan-cum-statement Form 26QE.