Are cryptocurrencies like Bitcoin taxed? If so, how?

Note: Bitcoin are crypto-currencies and comes under it with other crypto-currencies. 

The Union Budget 2022 planned to designate cryptocurrencies as virtual digital assets, which would result in cryptocurrency taxes in India (FY 2022–2023). (VDA).

Crypto-currencies are classified as assets, but their tax classification differs from that of traditional assets. A person is required to pay a flat 30 percent tax under the new crypto tax law on revenue derived from the transfer of cryptocurrencies and other virtual digital assets, such as NFTs.

The cost of acquisition is the only deduction the taxpayer may make from the sale price of a crypto asset, according to Archit Gupta, founder and CEO of Clear (previously Cleartax). The cost of the mining infrastructure would not be factored into the acquisition cost calculation, the government recently stated.

Cryptocurrency Tax Rule: Losses cannot be offset.
Losses cannot be adjusted within a single head, i.e., they cannot be offset against income from another VDA. Your tax obligation for NFT transfer profits is a fixed rate of 30%.

Crypto Tax Regulation: No carryover permitted.
The taxpayer is prohibited from carrying forward bitcoin losses under the crypto tax rules.

Date for reporting the 30% cryptocurrency tax: When is it Due?

From Assessment Year 2023–2024, the taxpayer will be required to pay a 30% tax on cryptocurrencies and other VDAs. Your whole VDA transfer revenue for the upcoming fiscal year (2022–2023) will therefore be subject to a 30% tax rate.

Tax on Cryptocurrency Exchange in Business Transactions.

Virtual digital assets (VDA), as defined by the government, are not money. 'However, unlike how it is defined for capital assets in the Income Tax Act, the term 'transfer' is not defined in reference to virtual digital assets. The definition of 'transfer' in the law must be made clear, as well as if such transactions that involve the payment of goods or services in cryptocurrency are included.

Taxes on cryptocurrency, NFT airdrops, or gaming coins.

Companies in the crypto and NFT sectors frequently employ airdrops to publicise the beginning of their projects. Similar to getting a coupon with a discount code in your inbox, airdrops work similarly.

Hope you liked my answer!