The Central Board of Direct Taxes (CBDT) has released a new guidance note to help crypto platforms understand their tax reporting responsibilities under the Income Tax Rules, 2026.
The guidelines are mainly aimed at Indian crypto exchanges and foreign crypto platforms operating in India.
They explain how crypto transactions should be reported and who is responsible for complying with the rules.
Here’s a simple breakdown of the key points.
Responsibility Lies with Crypto Platforms, Not Investors
The CBDT has clarified that the main responsibility for tax reporting rests with Reporting Crypto-Asset Service Providers (RCASPs), not individual crypto investors.
The guidance also explains how crypto platforms should report transactions that involve users or businesses operating across multiple countries.
These reporting rules came into effect after the Union Budget 2026.
According to the CBDT, the guidance is designed to make tax reporting easier to understand for financial institutions.
It also refers to the Common Reporting Standard (CRS) developed by the Organisation for Economic Co-operation and Development (OECD) to help ensure consistency in reporting across participating countries.
Who Should Be Treated as the Crypto User?
One of the key clarifications is about identifying the actual crypto asset user.
If a person or organisation is acting only as an agent, custodian, nominee, signatory, investment advisor or intermediary, they should not be treated as the crypto user.
Instead, the crypto platform must identify and report the individual or entity on whose behalf the account or transaction is being handled.
Large Crypto Payments May Need to Be Reported
The guidance note also explains when crypto payments must be reported.
If a crypto platform transfers more than $50,000 in crypto assets from a customer to a merchant while acting as the customer’s agent, the transaction must be reported as a Reportable Retail Payment Transaction.
However, if the platform is acting as the merchant’s agent instead, the reporting process changes. In such cases, the merchant’s customer will be treated as the crypto asset user, and the transaction will be reported accordingly.
Rules for Cross-Border Transactions
The CBDT has also provided guidance for transactions linked to multiple countries.
If a crypto transaction has connections with more than one partner jurisdiction, the platform should report it under the jurisdiction that has the strongest connection with the transaction.
This clarification is meant to avoid duplicate reporting and ensure that international transactions are reported correctly.
FAQs Included for Better Understanding
To make the new rules easier to follow, the CBDT has included a set of Frequently Asked Questions (FAQs) along with the guidance note.
The FAQs explain common situations and help crypto platforms better understand their reporting obligations under the Income Tax Rules, 2026.
