TDS on Virtual Digital Assets: Insights Into Section 194S

The Finance Act of 2022 initiated Section 194S in the Income-tax Act of 1961, starting July 1, 2022. This provision mandates a 1% TDS deduction on payments for transferring virtual digital assets (VDAs) such as cryptocurrencies and non-fungible tokens (NFTs) if the transaction surpasses Rs 10,000, or Rs 50,000 for specified individuals per fiscal year.