India has a new crypto tax regime in place and investors are struggling to understand its implications on their taxes. India’s first crypto tax calculation platform, KoinX, aims to make life easy on the tax front for crypto investors.
Launched on April 5, 2022, KoinX is seeing active interest, with over 16,000 Indian users in the waiting list. It claims to be a one-stop-shop for calculating tax levied on digital assets like cryptocurrencies, NFTs.
“Crypto transactions are complex, as apart from INR pairs, there are crypto-to-crypto transactions that are also allowed in this ecosystem. Since crypto is dynamic, it is difficult for an average person to keep track of the ever-changing prices. Keeping updated with new reforms of crypto tax laws in the country also becomes difficult,” KoinX’s founder Punit Agarwal told Business Insider India.
The Indian government announced new crypto taxes earlier this year, levying a 30 percent tax on crypto profits, effective April 1, and a 1 percent tax deductible at source (TDS) on all crypto transactions, effective July 1.
India’s crypto market is going through rocky times with Indian crypto exchanges reporting a drop of over 90% drop in their trading volumes, mostly hurt by the newtaxes.
Surviving the crypto bear market
However, angel investors are optimistic about the sector as evidenced by the recent investment in KoinX.
KoinX raised $1.5 million in seed funding from Polygon founder Sandeep Nailwal, iSeed Fund, Kube VC and over 40 plus angel investors on July 5, 2022.
“It is no doubt worrisome for an angel investor to see the disturbing numbers but a lot of companies built in the bull market are based on euphoria. The companies who survive the current bear market of crypto and blossom during this time are worth investing in. One such company is KoinX,” said Ajeet Khurana, crypto advisor and ex-CEO of ZebPay, one of India’s first crypto exchanges, and also an angel investor in KoinX.
KoinX acquired Crypto Kanoon on July 5, 2022 for an undisclosed amount to lasso in the loyal crypto community in India. Crypto Kanoon, co-founded in 2018 by Kashif Raza provides legal updates about cryptos in the country.
Crypto is an evolving space, with even the regulators still struggling to understand how it all works, KoinX says and its tax-calculation platform will help investors navigate this landscape better as it believes even chartered accounts are not up to speed on crypto.
“The first reaction of a chartered accountant in India is that crypto is not legal. Apart from the service fees, they often admonish users for keeping any asset in crypto. KoinX aims to address this,” said Raza.
KoinX is charging ₹749 per user per annum to calculate and prepare a ready-to-download tax report for filing crypto income. It has tied up with six crypto exchanges – CoinDCX, CoinSwitch, Binance, Vauld, Bitbns and WazirX – for data access.
The company aims to begin with taxes but can expand to other ancillary services in the future. Agarwal says the waitlisted users will get early access to the application and added benefits. Users who joined the waitlist between 8 pm IST to 11:59 PM IST on July 5, will enjoy using the platform free of cost for two tax seasons, he added.
The app version of the platform is expected soon.
The article originally published on Business Insider.