In India, the taxation system is going under strong change. The Draft Income Tax Rules 2026 are coming into effect on April 1, 2026. There are several new rules and changes. However, the most important changes are around cryptocurrency reporting. In addition, there is the formal recognition of the Central Bank Digital Currency (CBDC) as a valid mode of electronic payment.
Crypto Exchanges Now in the Tax Net
The most significant point of the Draft Income Tax Rules 2026 is that the crypto exchanges will have to share transaction data. They need to share data now directly with the Income Tax Department.
The draft lays down comprehensive reporting procedures. Besides, due diligence standards are also set that crypto-asset service providers will need to follow.
Hence, it is no longer voluntary disclosures, but rather it is now mandatory compliance. As a result, it will bring India’s crypto tax framework closer in line with global standards.
So if you are a crypto investor, you must know that now your every transaction will be monitored and reported to the government.
Important Note: If you haven’t been diligently reporting your crypto gains, now is the time to complete your Income Tax Return Filing before you start getting penalised and assessment notices.
CBDC Gets Official Tax Recognition in India
The Draft Income Tax Rules 2026 now make official recognition of the Digital Rupee. It is an Indian cryptocurrency and is an accepted mode of electronic payment. Hence, CBDC is now a government department handling cryptocurrencies and will make sure that the digital rupee is used legally and as legal tender.
PAN Thresholds and Other Key Reforms as per Draft Income Tax Rules
Beyond digital assets, the Draft Income Tax Rules 2026 also revise several long-standing thresholds.
- Firstly, Cash deposits or withdrawals totalling Rs 10 lakh or more in a fiscal year will now require PAN submission.
- Secondly, Immovable property transactions above Rs 20 lakh will also need PAN, up from the earlier Rs 10 lakh limit.
- Lastly, Motor vehicle purchases exceeding Rs 5 lakh — including motorcycles — will now come under the PAN requirement as well.
Conclusion
In conclusion, the Draft Income Tax Rules 2026 highlight India’s intent to build a technology-enabled, data-driven tax ecosystem. By pulling crypto exchanges into mandatory reporting and officially recognising CBDC, the government is closing the gaps that previously allowed digital asset transactions to fly under the radar.
The Central Board of Direct Taxes (CBDT) will notify the finalised rules by the first week of March 2026 after stakeholder consultations. For taxpayers, businesses, and investors, the message is clear that the digital economy is no longer a grey zone in India’s tax framework.
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