Overview: Crypto Company in India
Current State of Cryptocurrency in India
Navigating the Regulatory Landscape: Cryptocurrency Regulations in India
Starting a Cryptocurrency Company in India
Launching a cryptocurrency firm in India does not entail specific regulatory requirements until new legislation is enacted. Whether you are a domestic or international business owner, your primary obligation is to comply with the Companies Act of 2013. Furthermore, you must fulfil a set of additional prerequisites, including:
- Applying for a Tax Deduction and Collection Account Number (TAN),
- Acquiring a Permanent Account Number (PAN),
- Obtaining a Goods and Services Identification Account Number (GSTIN).
It's worth noting that in certain cases, obtaining a cryptocurrency license in India may become necessary, especially for activities related to the issuance and trading of various Virtual Digital Assets (VDAs).
Indian Crypto Exchange Requirements
Establishing virtual currency exchanges in India is a viable option once correct licenses are obtained. However, these entities are obligated to disclose their financial performance, including profits, losses, and cryptocurrency holdings, as well as client deposits. Additionally, Indian cryptocurrency exchanges must establish and adhere to Know Your Customer (KYC) standards, along with maintaining comprehensive records of their platform's traders and clients.
It's worth noting that the most recent information available on crypto businesses in India was released in March 2022. Up until that point, there were no explicit regulations governing the cryptocurrency exchanges. Nonetheless, it is widely expected that platforms will eventually be required to obtain such licenses due to the increasing number of regulatory measures being introduced.
Building a Skilled Workforce for Cryptocurrency Company
Taxation on Crypto Companies
It has been reported that the taxation framework for cryptocurrency in India has been established as follows:
Effective from April 2022, income generated from cryptocurrency transactions is subject to a 30% tax. No deductions whatsoever is allowed.
Additionally, these cryptocurrency businesses are expected to pay the Goods and Services Tax (GST).
Furthermore, any transactions conducted by such businesses is also liable for a 1% TDS (tax deducted at the source).