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      Question

      Which of the following is the status of

      Crypto-currencies in India?
      A These are used as a fiat currency. Correct Answer Incorrect Answer
      B These are seen as taxable financial assets. Correct Answer Incorrect Answer
      C The crypto-currencies are banned in India. Correct Answer Incorrect Answer
      D These are assets upon which a person is not required to pay a capital gains tax. Correct Answer Incorrect Answer
      E None of these Correct Answer Incorrect Answer

      Solution

      The 2022-23 Budget has brought in clarity with regard to levy of income tax on crypto assets. From April 1, a 30% I-T plus cess and surcharges, will be levied on such transactions in the same manner as it treats winnings from horse races or other speculative transactions. The Budget 2022-23 also proposed a 1% TDS on payments towards virtual currencies beyond Rs 10,000 in a year and taxation of such gifts in the hands of the recipient. The threshold limit for TDS would be Rs 50,000 a year for specified persons, which include individuals/HUFs who are required to get their accounts audited under the I-T Act. The provisions related to 1% TDS will come into effect from July 1, 2022, while the gains are taxed effective April 1.

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