Filing ITR with crypto investments: Common reporting mistakes that could trigger tax scrutiny

Assuming 1% TDS is the final tax is a mistake; TDS is only a collection mechanism, and investors must calculate and report actual gains with additional tax liability.

All crypto transactions must be reported regardless of gain size or losses, as domestic exchanges report to the Income Tax Department via Form 26AS and AIS.

Crypto income must be reported under the dedicated Schedule VDA, not under capital gains or income from other sources.

Regular capital gains rules for shares or mutual funds do not apply to crypto; use the specific tax regime for virtual digital assets.

Failing to reconcile TDS with Form 26AS and AIS can cause mismatches, delayed refunds, or tax notices.