Rule 243 of the Income-tax Rules, 2026

Where this rule sits

Rule 243 gives effect to Section 509 of the Income-tax Act, 2025. A rule cannot go beyond the section it serves: where the two seem to differ, the section governs.

← Rule 242  ·  Rule 244 →

What this rule does

The rule sets out what a reporting crypto-asset service provider must maintain and report about reportable users, and how the amounts are measured.

Sub-rule (1) applies for each relevant calendar year starting on or after the 1st January, 2026, subject to the provider's obligations under rule 242 and the due diligence procedures under rule 244, in respect of crypto-asset users that are reportable users or that have controlling persons who are reportable persons. Clause (a) requires the name, address, country or territory of residence, tin and date and place of birth (for an individual) of each reportable user; clause (b) requires all residences and all TINs where more than one is identified; clause (c) requires, where an entity has one or more controlling persons who are reportable persons, the entity's own details and each such person's name, address, residence, tin, date and place of birth, and the role by virtue of which he is a controlling person; and clause (d) requires the name, address and Permanent Account Number of the provider itself. Clause (e) requires, for each type of relevant crypto-asset in which relevant transactions were effected during the year, the full name of the type and then nine categories of aggregate data: acquisitions and disposals against fiat currency by gross amount, units and number of transactions; acquisitions and disposals against other crypto-assets by fair market value, units and number; reportable retail payment transactions; transfers to and by the reportable user not covered by those categories, sub-divided by transfer type known to the provider; and transfers by the user to wallet addresses not known to be associated with a virtual asset service provider or financial institution.

Sub-rules (2) and (3) relax two particulars. The tin need not be reported where no tin is issued by the country or territory in which the reportable user is resident for tax purposes, or where that country's domestic law does not require its collection; and a tin is treated as not issued where the country issues neither a tin nor a functional equivalent, or has not issued one to the particular individual or entity. The place of birth need not be reported unless the provider is otherwise required to obtain and report it under domestic law. Sub-rule (4) requires the information reported to identify the fiat currency in which each amount is reported.

Sub-rules (5) to (7) govern the statement. The statement of relevant transactions under section 509(1) is furnished in respect of each crypto-asset user or controlling person identified as a reportable user or reportable person; where due diligence under rule 244 identifies none, a nil statement is furnished; and the statement is furnished in Form No. 167 by the 31st of May of the calendar year following the year to which the information relates.

Sub-rule (8) supplies the measurement rules. For fiat currency acquisitions and disposals, amounts are reported net of transaction fees, in Indian Rupee, converting other fiat currencies at the telegraphic transfer buying rate on the date of the relevant transaction, aggregated by reporting category for each type of crypto-asset; an acquisition or disposal covers any transaction the provider effects where the user obtains or alienates a relevant crypto-asset, whether from a third-party seller or from the provider itself; and where the provider has no actual knowledge of the underlying fiat consideration, the transaction is reported as a transfer instead. For crypto-to-crypto transactions, fair market value net of transaction fees is determined in Indian Rupee at the time of each transaction, using the provider's crypto-asset to Indian Rupee trading pairs, and where a difficult-to-value asset is exchanged for one that can be readily valued, the valuation of the latter is relied upon; all such transactions with the same provider are reported under both the acquisition and disposal categories; and again, an absent actual knowledge case is reported as a transfer. For reportable retail payment transactions, the merchant's customer is treated as the crypto-asset user and so as the reportable user in addition to the merchant, and the aggregates are kept out of the transfer categories, while transfers that fail to be reportable retail payment transactions only because of the de minimis threshold go back into the transfer categories. For transfers to unknown wallet addresses, no reporting is required where the provider knows the address is associated with a virtual asset service provider or financial institution as defined in the Financial Action Task Force Recommendations; external wallet addresses must be collected and retained in the provider's records for a period not less than seven years; and wallet addresses themselves are not to be reported. For the transfer and retail payment categories, fair market value is determined in Indian Rupee using the provider's trading pairs, and where it does not maintain an applicable reference value a cascade applies — internal accounting book values first, then a value from third-party aggregators if the method is reasonably expected to be a reliable indicator, then the provider's most recent valuation, and only as a measure of last resort a reasonable estimate — with the alternative method used indicated in Form No. 167.

Sub-rules (9) and (10) require the statement to be furnished to the Director of Income-tax (Intelligence and Criminal Investigation) or the Joint Director of Income-tax (Intelligence and Criminal Investigation) through online transmission of electronic data to a designated server under digital signature, in accordance with the data structure specified by the Director General of Income-tax (Systems), "digital signature" being one issued by a Certifying Authority authorised by the Controller of Certifying Authorities. Sub-rule (11) requires every provider to communicate the name, designation and communication details of its designated director and principal officer to the Director General of Income-tax (Systems) and obtain a number enabling the statement to be furnished, and requires the statement to be signed, verified and furnished by the designated director, with a non-resident provider able to have it done by a person holding a valid power of attorney from that director. Sub-rule (12) defines "designated director" by entity type — Managing Director or whole-time Director duly authorised by the Board for a company, managing partner for a firm, proprietor for a proprietorship, managing trustee for a trust, and the person who controls and manages the affairs in any other case — and "principal officer" as an officer designated by the provider.

Why it is there

Section 509(1) requires a statement of relevant transactions but leaves the content, the measurement and the filing machinery to be prescribed. Crypto-asset activity is peculiarly hard to report on: the same trade can be against money or against another asset, values move continuously, and a transfer out may go anywhere. The rule answers each of those — a fixed set of aggregate categories, a single reporting currency with a stated conversion rate, a valuation cascade for assets with no reference price, and a rule for transfers whose destination is unknown — so that what different providers file is comparable.

Who it applies to

• A reporting crypto-asset service provider, resident or non-resident, effecting relevant transactions for crypto-asset users
• A reportable user, and an entity with one or more controlling persons who are reportable persons
• The customer of a merchant for whom the provider effects reportable retail payment transactions, who is treated as the crypto-asset user in addition to the merchant
• The designated director of the provider, who signs, verifies and furnishes the statement, and the principal officer
• The Director or Joint Director of Income-tax (Intelligence and Criminal Investigation), to whom the statement is furnished

The figures, and what each one turns on

The forms it prescribes

• Form No. 167 — statement of relevant transactions in crypto-assets under section 509(1), including a nil statement, in which any alternative valuation method used must be indicated

What this means in practice

Nothing about the filing is optional because there is nothing to report: sub-rule (6) requires a nil statement where due diligence under rule 244 identifies no reportable user or reportable person, and the 31 May date in sub-rule (7) applies to it as much as to a full statement. Two of the measurement rules produce results that look wrong until read carefully. Where the provider lacks actual knowledge — of the fiat consideration behind a purchase, or of which crypto-asset was acquired or disposed — the transaction does not drop out; it is reported instead as a transfer to or by the user, so unclassified activity still appears. And a crypto-to-crypto trade with a single provider is reported twice, once as an acquisition and once as a disposal, because both sub-clauses apply to it. The de minimis threshold for reportable retail payment transactions is not stated in this rule, but the rule tells you what happens to transfers that fall below whatever it is: they go into the ordinary transfer categories rather than disappearing. Wallet addresses are collected and kept for at least seven years but are not reported, and a transfer to an address the provider knows belongs to a virtual asset service provider or financial institution drops out of the unknown-address category. The relaxations in sub-rules (2) and (3) are narrow: the tin is excused only where the foreign country issues none or does not require its collection, and the place of birth only where the provider is not otherwise required to obtain and report it under domestic law.

An example

A provider effects, for a reportable user during 2026, purchases of a crypto-asset for Rs 40,00,000 and sales for Rs 55,00,000, both net of its fees, and an exchange of that asset for another one worth Rs 8,00,000 at the time of the trade. The purchases and sales go into the fiat acquisition and disposal categories with their unit counts and transaction counts; the exchange is reported under both the crypto-acquisition and the crypto-disposal categories, valued at Rs 8,00,000. A transfer the user makes out to an external wallet the provider cannot associate with a virtual asset service provider is reported by value and units, but the wallet address itself is not reported, though it is retained in the provider's records for at least seven years. The statement goes in Form No. 167 by 31 May 2027.

Where you meet this rule

A crypto exchange or similar service provider meets it in its annual Form No. 167 statement and in the systems that classify and value every user transaction through the year; a user meets it in the residence, tin and self-certification particulars the provider collects, and in what the Department later holds about his trading.

The words themselves

What people get wrong

• Filing nothing where no reportable user is identified. Sub-rule (6) requires a nil statement, and sub-rule (7) fixes 31 May for it.
• Dropping transactions the provider cannot classify. Sub-rules (8)(a)(vi) and (8)(b)(vi) require them to be reported as transfers to or by the reportable user.
• Reporting a crypto-to-crypto trade once. Sub-rule (8)(b)(v) subjects all such transactions conducted by the same provider to reporting under both the acquisition and disposal sub-clauses.
• Reporting gross amounts. Amounts paid or received and fair market values are reported net of transaction fees.
• Reporting wallet addresses. Sub-rule (8)(d)(iii) says the reporting of wallet addresses associated with transfers is not required, though they must be retained for not less than seven years.
• Taking a third-party price straight away where no trading pair is maintained. The cascade in sub-rule (8)(e)(iii) puts internal accounting book values first, and requires the method used to be indicated in Form No. 167.
• Assuming a non-resident provider cannot file. Sub-rule (11)(b) allows a person holding a valid power of attorney from the designated director to sign, verify and furnish the statement.

Read with

• Rule 242
• Rule 244