Schedule VDA in ITR-2: How to Report Bitcoin, Ethereum and Exchange P&L
30% plus 4% cess is the rate on every VDA gain reported in Schedule VDA of ITR-2 or ITR-3 — with type of VDA, acquisition date, transfer date, consideration, and cost in INR, not in Schedule OS or CG. The AIS shows gross sale consideration, so transaction-level disclosure is what reconciles.
Harun Raaj
Chartered Accountant · Harun Raaj & Associates
Every VDA transfer goes in Schedule VDA of ITR-2 (or ITR-3 if you also have business income) — one schedule that captures the type of VDA, date of acquisition, date of transfer, full value of consideration, and cost of acquisition in INR, and then taxes the net gain at 30% + 4% cess under s.115BBH of the Income-tax Act, 1961. It does not belong in Schedule OS (other sources) or Schedule CG (capital gains) — both are wrong homes for it, and either invites a s.139(9) defective-return flag. Your exchange's P&L statement is a starting point, not the return — you convert each trade to INR and map it to the schedule line by line.
Which form, which schedule
The hard rule: any VDA income, however small, disqualifies ITR-1. Schedule VDA exists in ITR-2 and ITR-3 only, so you cannot file Sahaj with a crypto line.
The fields in Schedule VDA
The department's SFT data reports gross sale consideration, not your net profit. That is why Schedule VDA asks for both gross consideration and cost: the declared gain must tie to what the AIS already shows. If you report only net gains, the reconciliation against gross proceeds fails and you invite a s.143(1) adjustment.
Converting exchange P&L to INR
Indian exchanges (WazirX, CoinDCX, ZebPay) report in INR — no conversion needed. Foreign exchanges (Binance, Kraken, Coinbase) report in USDT/USD, which you must convert to INR at the RBI reference rate on the trade date. The value to capture is the INR equivalent on the day of each transfer, not the rate on the day you check your portfolio. on the exact rule reference (the conversion basis cited is the RBI reference rate; confirm the operative rule for your filing year).
A swap is two events, not one. Converting Bitcoin to Ethereum is a taxable transfer of the BTC at its FMV, followed by an acquisition of the ETH at that FMV. Report the BTC transfer in Schedule VDA; the ETH becomes a new asset with a new cost basis. — the treatment of in-kind swaps follows from the transfer definition in s.115BBH read with s.2(47A), but specific CBDT guidance on swaps is limited.
One row per transaction or aggregated?
VERIFY current ITR instruction. The Schedule VDA structure supports transaction-level entry, but the department has at different times permitted aggregation per VDA type where per-transaction detail is impractical. The safe practice that reconciles cleanly against AIS: keep per-transaction rows for the year's transfers, and where the portal limits you, aggregate per VDA type with supporting detail retained. What you must not do is report a single net number that cannot be tied back to the exchange statement.
Worked example: Rohan sells half a Bitcoin
Persona: Rohan, salaried employee, FY 2025-26 (AY 2026-27). No business income.
Facts:
- Buys 0.5 BTC for ₹25,00,000 on 15 Jan 2026 (Indian exchange, INR).
- Sells 0.5 BTC for ₹30,00,000 on 20 Jun 2026.
- Exchange deducts 1% TDS u/s 194S: ₹30,000.
Step 1 — Schedule VDA entry.
- Type: Bitcoin (crypto currency)
- Acquisition date: 15-01-2026; Transfer date: 20-06-2026
- Full value of consideration: ₹30,00,000
- Cost of acquisition: ₹25,00,000
- Gain: ₹5,00,000
Step 2 — Tax.
- ₹5,00,000 × 30% = ₹1,50,000; cess 4% = ₹6,000 → ₹1,56,000
Step 3 — TDS credit.
- Claim the ₹30,000 (s.194S) from 26AS. Net payable: ₹1,26,000 — payable as advance tax (s.234B/234C interest applies if deferred).
Step 4 — What is NOT deductible. Exchange trading fees, network/gas fees, and any charges the exchange levied are not deductible — only the ₹25,00,000 cost of acquisition counts. If the exchange P&L shows "net profit ₹4,70,000 after fees," that is not your taxable figure; the schedule wants gross consideration minus cost, i.e. ₹5,00,000.
Reproduce the arithmetic in the Crypto VDA Tax Calculator.
Changed FY 2025-26: The Schedule VDA layout has been stable since AY 2023-24, but two things changed in practice for FY 2025-26: (1) exchange SFT data now reaches a large share of filers, so the department compares declared gains to reported gross proceeds automatically; (2) AIS is the default reconciliation view on the portal, and "VDA" transactions appear there as a distinct category — reconcile against it before filing, not after the 143(1) intimation arrives.
Frequently asked questions
1. Where do I report crypto gains in ITR-2?
Schedule VDA. Report each transfer's type, acquisition date, transfer date, consideration, and cost in INR. Do not use Schedule OS or Schedule CG.2. Do I report my exchange P&L as shown on Binance/WazirX?
No, not directly. Convert each foreign-currency trade to INR at the RBI reference rate on the trade date, and report gross consideration minus cost of acquisition — not the platform's net-profit figure.3. Is VDA income "capital gains" or "other sources"?
It is charged under s.115BBH as a separate special rate, and Schedule VDA is the reporting home. Treating it as ordinary capital gains or other sources is the most common filing error. [VERIFY current ITR-2 instructions] on the head-of-income label before filing.4. Can I aggregate all my trades into one line?
Only per the current ITR instruction — transaction-level disclosure is the safe default; aggregation per VDA type may be permitted. Never file a single number that cannot be traced to the exchange statement.5. What if I have a crypto loss?
Report it in Schedule VDA anyway — the loss cannot be set off against other income or carried forward, but the department needs to see the transfer to close the reconciliation with its SFT data.6. Which ITR form if I trade crypto as a business?
ITR-3, with books of account and possibly a s.44AB tax audit. Schedule VDA is not available in ITR-1 or ITR-4.7. Does the exchange's TDS appear on 26AS?
Yes — the 1% s.194S deduction appears in your 26AS/AIS. Claim it as a credit against the s.115BBH liability; the balance is what you pay.---
Last verified: 2026-08-08 (FY 2025-26 / AY 2026-27)
Sources: s.115BBH and s.2(47A), Income-tax Act, 1961; s.194S (1% TDS); Schedule VDA in ITR-2/ITR-3 (CBDT/Income-tax Department form instructions); s.139(9) (defective return for wrong form/schedule); SFT reporting of VDA transfers by exchanges (Rule 114E). Aggregation guidance and head-of-income label flagged for CA verification per current ITR instructions. For a VDA computation, use the Crypto VDA Tax Calculator.
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