29 January 2018
1. Can i as a resident Indian buy BITCOINS from an foreign individual by remitting USD from my bank account to him overseas?
2. BITCOINs purchased from overseas when sold in India and sale proceeds recieved in India Bank, what would be income tax head, i.e. would be income from short term capital gain or income from other sources?
29 January 2018
1, can you purchase. Yes as the transaction should get covered under liberalised remittance norms. However, it is very much possible that banks may not allow such transaction as despite without any regulatory restriction, banks are not permitting transactions for cryptocurrency.
2. at present Income-tax department is taxing such transactions under capital gains
29 January 2018
Thanks Mr Kaushik for a prompt reply, 1. I was able to remit amount to a foreigner today using my ICICI online banking for 10,000$ 2. When i sell this BITCOIN recieved on my coinsecure Exchange in India, the money will be credited back into my Axis bank account. Income tax(short term capital Gains) would be payable on the profit amount or would it be on full amount recieved in bank?
29 January 2018
I believe you should keep a track of whether banks are allowing transactions via coin exchanges or not. Many coin exchanges are facing problem. Moneycontrol has covered this issue today.
with regards to taxability, it will always be on the gains party. However, you should be able to establish that the payment made to the foreigner via icici was made for purchase of bitcoins i.e. the documents should clearly mention what the payment is being made for.
CAclubindia
