Cryptocurrencies, NFTs, and the Metaverse are terms that you may not yet be familiar with, understand, or have had any personal experience. With so much coverage of these cutting-edge technologies, the rush to invest, and the associated worries about a potential ban in India, it was only a matter of time before the taxman joined the party to make sure that the correct taxes were paid.

Cryptocurrency is known as a Virtual Digital Asset, or VDA, in India. The finance minister Nirmala Sitharaman unveiled the provisions for taxation on virtual currency, non-fungible tokens, and other VDAs in Budget 2022. (Virtual Digital Asset). They also included provisions for tax on giving gifts of cryptocurrency, NFTs, etc. According to the Income Tax Act, gifts of cryptocurrencies, NFTs, etc. are taxable in the hands of the recipient.

Despite being around since 2015, NFTs didn’t really take off until 2021. India has 11 NFT companies, which is the third-highest number worldwide, according to new research from NFT Club, a technology-focused resource platform. Meanwhile, five of the top 10 most well-funded NFT companies in the world are located in the US, which has the most of them (91).

(By Nishant Shukla)