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P2P crypto trading new rules in India 2024 ?

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In 2024, India imposed a 30% profit tax and a 1% tax collected at source (TDS) on all cryptocurrency transactions. The 1% TDS remains, but there is no penalty for failure to comply if a citizen tries to avoid paying the tax or makes an incomplete payment. In court, a store might argue that no punishment is imposed, allowing them to escape with only tax liability. In the event of non-compliance, a fine equal to the tax due and/or imprisonment for 3 to 84 months may be imposed.

According to crypto tax consultant Anoush Bhasin, who is also a member of the committee, the amendment recommends a fine and probable jail for at least three months and up to seven years.

 

taxes and TDS:

In her Budget address last year, Nirmala Sitharaman, the finance secretary, introduced crypto taxes for the first time, classifying private cryptocurrencies as digital currencies known as virtual digital assets (VDAs). However, there was no mention of cryptocurrency during the Budget address on February 1. However, some additional developments were then revealed in the fine text, indicating a shift in TDS regulations that influence VDAs.Last year, it was declared that income from cryptocurrency trading would be subject to a 30% tax plus appropriate surcharges and a 4% cess. Furthermore, losses on any one cryptocurrency cannot be credited against earnings on other digital currencies, and one per cent TDS was paid on crypto under section 194S of the Income Tax Act. 

The most important change is that the Enforcement Directorate can now look into any financial crime concerning Bitcoin holdings. According to the announcement, the definition of 'virtual digital asset' shall be the same as in the Income Tax Act. Cryptocurrencies and non-fungible tokens are included in the definition. Under the PMLA, all crypto exchanges are obligated to report any suspicious activity to the Financial Intelligence Unit India (FIU-IND) and to conduct due diligence by KYC, Anti-Money Laundering Regulations, and reporting. These are commonly followed by banks and other financial organisations that come under the PMLA reporting entity categorization.

Many people have been using crypto P2P networks for unlawful activities in recent years. Some individuals are dealing up to Rs 250 crore on these sites without paying any TDS or income tax. In India, there are an increasing number of such P2P sites. P2P merchants are also receiving an increase in income tax notices. Unfortunately, misleading news is also proliferating in India's bitcoin sector. To compare, the worldwide market value of cryptocurrencies is now more than $250 billion, up from around $190 billion earlier this year. Indeed, even after the

At the same time, market false news has tainted investors' sentiments. Cryptocurrencies are subject to the same volatility as fiat currencies, but they are more powerful because of their technological backing. Its market value is increasing, and this is the only way it will survive. Consider its true potential if the crypto market also receives regular investment backing. It will just be noticeable.

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How to Handle P2P:

This growth in P2P trade volume has resulted in an increase in P2P frauds. These scams frequently employ stolen financial information or deceive clients with false promises of significant returns before using their banking information to defraud P2P users.

Two individuals were detained earlier this month in the Indian city of Ujjain in connection with the Binance P2P fraud. Police found many false bank accounts, ATM cards, and papers from the accused, who reportedly paid 1,500 Indian rupees ($18) for bogus IDs and personal information to defraud Binance P2P customers.

 

image credit: canva

cryptocurrencies Bill: 

Since the introduction of cryptocurrencies, this has been a contentious issue. Some governments trust in cryptocurrencies' decentralised power, while others do not. The legal position of cryptocurrency differs per nation. Cryptocurrencies are used to perform anonymous transactions between account holders all over the world. This causes monetary issues for governments throughout the world. Because of the absence of regulation and illicit ties, certain officials and politicians may oppose the usage of cryptocurrencies.

 

Cryptocurrency Taxes in India: 

One of the most perplexing elements in India is the taxation of cryptocurrency. In the beginning, there was no income tax law or the GST (Goods and Services Tax) in India that classified cryptocurrencies. The Finance Minister announced a tax scheme for virtual or digital assets, including cryptocurrencies, in the latest Union Budget 2022. Cryptocurrency traders must declare computed profits and losses as part of their revenue. Income from the transfer of digital assets, such as cryptocurrencies and NFTs, will be taxed at a rate of 30%. When reporting revenue from virtual asset transfers, only acquisition expenses and no deductions will be permitted. If the buyer's payment exceeds the limit, 1% tax is deducted at the source (TDS).

 

Faqs:

What exactly is crypto P2P trading?

In the crypto realm, peer-to-peer trading entails the direct exchange of digital assets between individuals. P2P trading platforms operate as middlemen, facilitating these transactions. It provides consumers with a decentralised and private way to exchange cryptocurrency.

How does peer-to-peer trading work?

P2P trading is primarily conducted via specific platforms that link buyers and sellers. Users make offers to purchase or sell cryptocurrency, specify the transaction's parameters, and then interact directly to finalise the transaction. An escrow provider frequently protects the cash until the transaction is completed.

Are there any advantages to crypto P2P trading?

Yes, P2P trading has benefits like secrecy, flexibility in trading conditions, a wide range of supported cryptos, and frequently lower costs. Users can conduct transactions without relying on centralised exchanges.

What are the hazards of peer-to-peer trading?

Scams, payment disputes, market volatility, and technological difficulties are all dangers associated with peer-to-peer trading. To reduce these dangers, due diligence and the use of trusted platforms are required.

 

Conclusion:

P2P trading in crypto provides a flexible, accessible method for digital asset exchanges, offering privacy, a wide range of supported cryptos, and flexible terms. However, traders must navigate regulatory frameworks, legality, risks, market volatility, and technical challenges.

relative article:https://www.bitcryptatipsb.com/2023/11/binance-crypto-p2p-trading-sell-and-buy.html



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