TDS, or Tax Deducted at Source for Virtual Digital Assets (VDA) was introduced in a new section of the Finance Bill of 2022, called 194S in the Income-Tax Act, 1961. It mentions levying a 1% TDS on any consideration paid for the transfer of Virtual Digital Assets.
In other words, when you sell a crypto on Mudrex, you (or the exchange facilitating the transaction) will have to deduct and withhold 1% of the transaction value as TDS, which is then paid to the Government.
As per the Income Tax regulations, if you have done transactions (both buy and sell) for less than ₹10,000, TDS may not be applicable. But please note that these limits apply at user level across all exchanges they make trades on. Since Mudrex would not be aware of the trades across other platforms, we will be required to deduct TDS from all transactions starting July 1, 2022.