The Union Budget 2026 has introduced stricter penalties for cryptocurrency platforms that fail to report user transactions accurately, signaling increased government oversight of digital asset trading. Under Section 509 of the Income Tax Act, crypto exchanges and intermediaries are required to submit periodic statements detailing crypto-asset transactions to the Income Tax Department. While this reporting obligation has existed for some time, enforcement has been limited.
From April 1, 2026, platforms that fail to file the required statements will face a fine of two hundred rupees per day until the information is submitted. Entities that provide incorrect or misleading details and fail to correct them will be liable to a flat penalty of fifty thousand rupees.
This move is aimed at improving compliance and reducing tax evasion in the digital asset sector. Exchanges such as WazirX and CoinDCX, along with other trading and custody platforms, will need to strengthen their reporting systems to ensure that transactions are reported on time and the details provided are accurate.
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