BackClear launches crypto taxation and optimization service
The platform aims to tie-up with all major crypto exchanges and Defi (Decentralized finance) protocols/exchanges in the country to help them with tax deducted at source, invoicing and GST
PremiumNEW DELHI: Days after India introduced a new tax regime for virtual digital assets, online taxation and fintech software provider Clear (formerly ClearTax) has announced the launch a service called ‘Clear Crypto Tax’ that will help investors manage their crypto assets portfolio and taxes.
The platform is working with exchanges to have an Application Programming Interface (API), which can integrate with exchanges and bring tax information in a format that helps taxpayers calculate as well as account and pay for taxes every quarter and every year.
The platform also aims to tie-up with all major crypto exchanges and Defi (Decentralized finance) protocols/exchanges in the country to help them with tax deducted at source (TDS), invoicing and GST.
For the first, finance minister Nirmala Sitharaman on 1 February had announced a 30% tax on any income from transfer of virtual digital assets or crypto assets. The tax proposal covers all emerging digital assets, including non-fungible tokens (NFTs), assets in metaverse, digital currencies and tokens, among others. Along with the 30% tax, the Union Budget 2022-23 has also proposed a 1% TDS on the transfer of such assets.
Clear will also look to partner and help exchanges report TDS to Centre.
“Historically, we only had physical assets, capital assets and so on so forth. A vacuum has got created to solve for crypto taxes. There are 6.3 crore taxpayers in India and crypto exchanges have published that they have one crore investors on their platforms. We want to bring them to dealing with the digital economy, digital assets and with the tax elements," said Archit Gupta, founder and chief executive officer of Clear.
Apart from crypto investment and trading, Clear plans to provide taxation and management service to scenario such as airdrops and staking in crypto.
In terms of tax optimisation, the company will look to address how to set off loss and transfer of assets. However, according to Gupta, more clarity is needed on Budget proposals on these two aspects.
On charges for these services, Gupta said, “There will be a free-tier for low volume and low value transactions. There'll be a charge for premium tiers for high volume users and expert services to those who are looking for expert advisory and management."
Clear in January had raised an undisclosed funding from global product and engineering veterans including Aparna Chennapragada, chief product officer of American stock trading platform Robinhood.
Surojit Chatterjee, chief product officer of cryptocurrency exchange Coinbase, and Balaji Srinivasan, former chief technology officer of Coinbase and former General Partner at Andreessen Horowitz, had also invested in their individual capacities.
Clear had then announced plans to launch new products in the Web3 space.
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