How to Claim Crypto Losses in ITR AY 2025-26: Complete Guide for Indian Investors
Table of Contents
📌 Introduction
With the rise of cryptocurrency trading in India, many retail investors faced unrealized losses or actual trading losses in FY 2024–25. If you’re one of them, you might be wondering, “Can I claim crypto losses in ITR for AY 2025–26?”
The short answer is: Yes, but with limitations. This blog breaks down everything you need to know to claim your crypto losses smartly while filing Income Tax Returns.
💼 Are Crypto Gains and Losses Taxable in India?
Yes. As per the Finance Act 2022, income from the transfer of virtual digital assets (VDAs) like Bitcoin, Ethereum, Solana, Dogecoin, etc., is taxable at a flat 30% rate under Section 115BBH, effective from April 1, 2022.
This means:
- Gains are taxable at 30% (plus surcharge & cess)
- Losses cannot be set off against any other income
- No deduction allowed for expenses (other than acquisition cost)
❌ Can You Claim Crypto Losses in ITR AY 2025-26?
You cannot set off crypto losses against:
- Salary
- House property
- Business income
- Capital gains
- Other sources (FD interest, dividends, etc.)
However, under Section 115BBH:
You can adjust crypto losses against crypto gains (from other VDAs), but not carry them forward to the next year.
✅ When Can You Claim Crypto Losses?
You can offset losses from one VDA against profits from another VDA in the same financial year (FY 2024–25).
Example:
If you made:
- ₹1,50,000 profit from Ethereum
- ₹80,000 loss from Dogecoin
Then your net taxable crypto income = ₹70,000.
But you cannot carry forward the ₹80,000 loss if you don’t have a crypto gain this year.
🧾 Documents You Need Before Claiming Crypto Losses
To file your losses correctly:
- Crypto transaction history (CSV or Excel file)
- P&L summary from exchanges like WazirX, CoinDCX, Binance, or CoinSwitch
- Trading fees charged by exchange
- Wallet-to-wallet transfer logs (for cost basis)
🧮 How to Calculate Crypto Losses
Use the FIFO (First-In-First-Out) method for tracking cost basis and profits. Many Indian crypto tax calculators (like KoinX, Quicko, or TaxNodes) offer automatic tools for this.
Simple Example:
| Transaction Date | Asset | Buy Price | Sell Price | Gain/Loss |
|---|---|---|---|---|
| Jan 10, 2025 | Bitcoin | ₹2,00,000 | ₹1,50,000 | -₹50,000 |
| Feb 20, 2025 | Ethereum | ₹80,000 | ₹1,00,000 | +₹20,000 |
Net taxable = ₹20,000 gain – ₹50,000 loss = ₹30,000 loss (not taxable)
But you can only claim this if it offsets other crypto gains in the same year.
💻 Step-by-Step Guide to Claim Crypto Loss in ITR for AY 2025–26
Step 1: Choose the Right ITR Form
For most crypto investors:
- ITR-2 if you have capital gains
- ITR-3 if you treat crypto as business income
Step 2: Classify Crypto Income Correctly
Report under “Income from Other Sources” if:
- You trade occasionally
- You don’t treat crypto as business
OR under “Business Income” if:
- You’re a frequent trader
- You operate via P&L method
Step 3: Report Gains and Losses Separately
In the “Schedule VDA” section of the ITR:
- Report gains with date-wise breakdown
- Deduct loss from another VDA if applicable
- Do not adjust against salary or other income
Step 4: Verify With Crypto Tax Calculator
Use platforms like:
These tools auto-fetch trades and calculate tax as per Section 115BBH.
Step 5: Submit and E-Verify
After filling:
- Submit the ITR
- E-verify using Aadhaar OTP, net banking, or EVC
📊 Which Exchanges Allow Crypto Tax Reports?
| Exchange | Tax Report Support | Export Format |
|---|---|---|
| WazirX | ✅ Yes | CSV, Excel |
| CoinDCX | ✅ Yes | Excel |
| Binance | ✅ Yes | CSV |
| CoinSwitch | ✅ Yes | PDF, CSV |
Download these before starting your ITR process.
⚠️ Mistakes to Avoid When Claiming Crypto Losses
- ❌ Trying to set off crypto losses against salary or FD
- ❌ Reporting wrong acquisition cost
- ❌ Ignoring wallet-to-wallet transfers
- ❌ Not using a tax calculator
- ❌ Skipping Schedule VDA
📈 Can You Save Tax on Crypto Losses?
Technically, no, but you can reduce the tax liability on your overall VDA portfolio by offsetting gains and losses within crypto assets only.
🔚 Conclusion
Crypto taxation in India is still evolving, but the government has made it clear through Section 115BBH that:
- Gains from crypto = taxable at flat 30%
- Losses can be adjusted only against other VDA gains in the same year
- No carry forward of losses to next year
FAQs: Claiming Crypto Losses in ITR for AY 2025–26 (India)
1. Can I claim crypto losses in my ITR in India for AY 2025–26?
Yes, but only to the extent of offsetting crypto gains from other virtual digital assets (VDAs) in the same financial year (FY 2024–25). You cannot set off crypto losses against income from salary, business, capital gains, or other sources.
2. Under which section are crypto losses handled in income tax law?
Crypto losses and gains are governed under Section 115BBH of the Income Tax Act, applicable from April 1, 2022.
3. Can I carry forward crypto losses to the next year?
❌ No. Under Section 115BBH, you cannot carry forward crypto (VDA) losses to the next financial year.
4. Can I set off crypto loss against salary or stock market profit?
No. Losses from cryptocurrencies cannot be adjusted against:
- Salary income
- Capital gains from stocks, mutual funds, real estate
- Interest income or dividends
They can only be offset against other crypto gains.
5. Is it mandatory to report crypto losses in the ITR?
While not mandatory, it is highly recommended if you want to offset crypto losses against crypto gains in the same year. You must report this in Schedule VDA of the ITR form.
6. Which ITR form should I use to declare crypto income or loss?
- Use ITR-2 if crypto is treated as capital gains
- Use ITR-3 if you consider crypto trading as business income
7. Where do I report crypto losses in the ITR?
Report in the ‘Schedule VDA’ section, where gains and losses from virtual digital assets must be declared with detailed transaction data.
8. What documents do I need to claim crypto loss?
- Trade summary from exchanges (CSV or PDF)
- Profit and Loss report
- Transaction logs or wallet history
- Screenshot of exchange-ledger, if needed
9. Which platforms provide crypto tax reports in India?
Top platforms include:
These tools help compute crypto taxes and generate compliant reports for ITR filing.
10. Can I amend my ITR if I forgot to claim crypto loss?
Yes, you can revise your ITR before December 31, 2025, if you initially missed reporting your crypto loss.
