The document outlines 10 key facts about bitcoins, indicating that the Reserve Bank of India (RBI) has not yet classified them as illegal or legal tender. It explains the implications of trading bitcoins under FEMA regulations, taxation, and GST based on their classification. The document highlights that the treatment of bitcoin in transactions depends on whether it is considered a good, asset, or currency.

1. 10 Key Facts About Bitcoins

2. 1. RBI has neither declared the crypto
currencies as illegal not has it accepted
these as legal tenders.

3. 2. If RBI declares Bitcoin as a currency
then any trading in it would be subject to
FEMA Regulations.

4. 3. The question whether dealing in Bitcoin
is a current account transaction or not
wholly depends on whether Bitcoin is a
‘good’ or an ‘asset.

5. 4. If it is not a good, then foreign
transactions in Bitcoin shall be treated as
capital account transactions requiring nod
from the RBI

6. 5. Bitcoins could be deemed as capital
assets for the Income-tax purpose if
purchased for the purpose of
investments.

7. 6. Income from sale of Bitcoins would be
taxable as business income if the
transactions in bitcoins are substantial &
frequent

8. 7. While as STCGs are taxable as per the
slab rates applicable to a taxpayer, LTCGs
are taxed at the flat rate of 20%.

9. 8. If Bitcoins are classified as currencies,
then no GST can be charged on its
trading.

10. 9. If Bitcoin is not considered as a
currency, any trading in Bitcoin would be
considered as a ‘Service’ under GST.

11. 10. Exchange of INR into Bitcoin will
subject to GST @ 18% on commission
amount.

12. THANK YOU
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