Crypto Tax for NRI in India: Residency, TDS and DTAA
NRIs pay 30% plus cess on crypto gains taxable in India. How residency decides it, why TDS on NRI sales differs from 1%, and where DTAA relief is unclear.
If you are a non-resident Indian (NRI), crypto gains that are taxable in India are taxed at the same flat 30% plus 4% cess as for residents, with no deductions other than purchase cost and no loss set-off. The key differences are which gains India can tax at all, which depends on your residential status, and the TDS: the 1% crypto TDS applies to payments to residents, while payments to non-residents fall under the general non-resident TDS rules, which can mean a much higher deduction.
Key takeaways
- Your tax status for the year (resident, RNOR or non-resident) is set by days spent in India, not by your passport or bank account type.
- Gains India can tax are taxed at 30% plus 4% cess, with surcharge at higher incomes. Losses cannot be set off or carried forward.
- The 1% crypto TDS (the rule known as Section 194S) is for resident sellers. For non-residents, tax is deducted under the non-resident rule (Section 195), usually at the full rate.
- Tax treaties (DTAA) do not mention crypto. Whether a treaty protects your gain is unsettled, so take advice from a chartered accountant.
- Many Indian exchanges do not onboard NRIs, or require a resident bank account.
Step 1: work out your residential status
Indian income tax does not care whether you hold an NRE account or an OCI card. It asks how many days you were physically in India during the financial year (1 April to 31 March). The tests carried over into the Income-tax Act, 2025 with the same substance as before:
| Situation | Usual result |
|---|---|
| In India 182 days or more in the year | Resident |
| Indian citizen or person of Indian origin visiting India, Indian income up to ₹15 lakh, under 182 days | Non-resident |
| Visiting, Indian income above ₹15 lakh, 120 to 181 days, and 365 days or more in the previous four years | Resident but not ordinarily resident (RNOR) |
| Indian citizen with Indian income above ₹15 lakh who is not liable to tax in any other country | Deemed resident (RNOR) |
| Indian citizen leaving India for a job abroad in the year | Resident only if in India 182 days or more |
These are summaries. The exact tests have extra conditions, so if you are close to any line, have a chartered accountant check your status before you file.
Step 2: which crypto gains India can tax
A person who is resident and ordinarily resident is taxed on worldwide income, including gains on a foreign exchange or a private wallet. A non-resident is taxed only on income that is received in India or that accrues or arises in India. An RNOR is broadly treated like a non-resident for foreign income, with some exceptions.
The difficult part is deciding where a crypto gain "arises". Crypto has no fixed location. The rules introduced as Section 115BBH set the rate but do not say where a virtual digital asset is situated. In practice:
- Selling on an Indian exchange and receiving rupees in India is the case most likely to be treated as taxable in India.
- Selling on a foreign exchange while living abroad, with proceeds staying abroad, is a grey area. Many advisers consider it outside Indian tax for a genuine non-resident, but there is no clear ruling on it.
- Coins bought while you were resident and sold after moving abroad (or the reverse) raise timing questions a professional should review.
Where Indian tax applies, the maths is the same as for residents. A ₹1 lakh gain costs ₹31,200; see our worked example on ₹1 lakh crypto profit and the full crypto tax in India guide.
Step 3: TDS for NRIs is different
For residents, an exchange deducts 1% of the sale value as TDS. That rule applies to payments made to a resident. When the seller is a non-resident, the 1% rule does not apply. Instead, the payer has to deduct tax under the general rule for payments to non-residents (Section 195), at the rate that applies to the income, which for crypto gains means 30% plus surcharge and cess on the taxable amount.
Two practical effects follow:
- Cash-flow hit. If the payer cannot work out your cost, it may deduct on a larger amount than your actual gain. You get any excess back only after filing a return.
- Lower deduction certificate. A non-resident can apply to the Income Tax Department for a certificate allowing lower or nil deduction where the actual tax due is lower. This takes time and paperwork.
Our explainer on 1% TDS on crypto covers the resident rule, and how to claim a crypto TDS refund covers getting excess TDS back.
Step 4: can a DTAA save you tax?
India has double taxation avoidance agreements (DTAAs) with many countries, including the UAE, the USA, the UK, Singapore and Canada. None of them was written with crypto in mind. Whether a crypto gain falls under the treaty's capital gains article or its "other income" article, and which country gets the right to tax it, has not been settled by Indian courts or by a CBDT circular.
- To claim any treaty benefit you generally need a Tax Residency Certificate from your country of residence and Form 10F filed on the Indian e-filing portal.
- If both countries tax the same gain, the treaty usually lets you claim credit in one country for tax paid in the other. How that works depends on your country's rules.
- The UAE has no personal income tax, so an NRI in Dubai gets no foreign credit to offset Indian tax. That makes the question of whether India can tax the gain at all more important.
Because this is unsettled, we suggest a chartered accountant with cross-border experience before relying on a treaty position.
Step 5: filing your return
If you have crypto income taxable in India, or TDS to reclaim, file an Indian return. Report each sale in Schedule VDA with dates, cost and sale value, using ITR-2 (or ITR-3 if it is business income). ITR-1 is not available to non-residents. Our step-by-step guide on how to show crypto in Schedule VDA applies to NRIs too. The crypto tax calculator gives a quick estimate.
Can NRIs use Indian crypto exchanges?
Crypto is legal to hold in India, but many Indian exchanges only onboard people with a resident Indian bank account and Indian KYC, and some do not accept NRE or NRO accounts. Check each platform's current policy before depositing. If you do use one, pick a platform on the FIU-registered exchanges list. Foreign exchange rules for NRIs moving money into and out of India for crypto are not clearly spelt out, so ask your bank before routing funds through an NRE or NRO account.
For reference, bitcoin is ₹7,969,285 in India right now; compare local prices on our bitcoin price in UAE and bitcoin price in USA pages.
FAQ
Do NRIs pay 30% tax on crypto in India?
Yes, if the gain is taxable in India. The rate is a flat 30% plus 4% cess, with surcharge at higher incomes, the same as for residents.
Does the 1% crypto TDS apply to NRIs?
No. The 1% rule covers payments to residents. Payments to non-residents fall under the non-resident TDS rule, usually at the full applicable rate.
Is crypto sold on a foreign exchange taxable in India for an NRI?
For a genuine non-resident, many advisers consider it outside Indian tax if the gain does not arise in India and is not received in India, but the law does not say where crypto is located. Get professional advice.
Can I claim DTAA benefits on crypto gains?
Possibly, but no treaty mentions crypto and the position is unsettled. You would need a Tax Residency Certificate and Form 10F, and a chartered accountant should review the claim.
I returned to India. How are my crypto holdings taxed?
Once you become resident, gains on sale are taxed at 30% plus cess. Keep records of your original purchase cost, because only the cost of acquisition can be deducted.
This article is AI-assisted, educational and general in nature. It is not financial advice and never a guarantee of profit. Every trade is at your own risk on your own exchange. See our risk disclosure and editorial policy.
