Moving crypto from one wallet you own to another wallet you own is not taxed in India. There is no buyer, no price and no change of ownership, so it is not the “transfer” that India’s 31.2% crypto tax and 1% TDS are built around. That plain answer matters this week, because a hardware wallet maker has just told some of its customers to do exactly this, quickly.
What Trezor said
On 30 October Trezor published a warning for anyone who bought its wallets from CryptoBilis, a Southeast Asian seller that was an official Trezor reseller until Trezor removed it on 9 October. A customer in Indonesia reported, on 28 October, an extra circuit board inside a Trezor Safe 5 bought from CryptoBilis on Tokopedia in August. The report describes a cellular module and antenna placed between the main board and the screen that reads what the screen shows, including the recovery phrase, and sends it out over a mobile network when the device is plugged in.
Trezor says it has not yet examined the device in its lab and that no CryptoBilis buyer has reported a loss. It is treating the report as credible anyway. Its advice to anyone who bought from CryptoBilis since March 2026: move funds to a newly created wallet with a new seed, and never type the old recovery phrase into another device, because that phrase may already be known. A Trezor spokesperson told Cointelegraph that seals and packaging “are not sufficient on their own”.
This is the same seller at the centre of the tampered Ledger cases we covered in our Indian buyer’s checklist for Ledger wallets. No Indian seller has been named in either case. But many Indians buy hardware wallets through marketplaces and third-party sellers, and anyone who ever bought a second-hand or unofficial device faces the same question: if I move everything, what does the taxman see?
The move itself: no tax, no TDS
India taxes income from the transfer of a virtual digital asset at a flat 30% plus 4% cess (31.2%), and requires 1% TDS when someone pays for that transfer. Sending your own Bitcoin from an old wallet to a new wallet in your own name has neither a counterparty nor a payment. Your cost and your holding date stay as they were, and the tax arrives only when you finally sell, swap or spend the coins.
The one grey corner is the network fee, which is paid in the coin itself. The law does not spell out how to treat it. At today’s fees the amount is tiny: a simple Bitcoin transfer of about 141 virtual bytes at 1 sat per vbyte (mempool.space) costs 141 sats, about ₹10 at ₹73,28,336 per BTC on 31 October. Our Bitcoin transaction fee calculator in ₹ shows the live figure. Keep the transaction ID for your records either way.
Where people accidentally create a tax bill
Panic moves are where the mistakes happen. This table compares the usual options for someone who wants coins off a suspect device:
| What you do | Taxable sale in India? | 1% TDS? | Main risk |
|---|---|---|---|
| Send the same coin to a new hardware wallet you set up yourself | No | No | Setting up the new device from a fresh, trusted source |
| Send the same coin to a software wallet you control | No | No | Phone or computer malware |
| Deposit the same coin to your account on an Indian exchange | No (still yours) | No | Exchange custody; use an FIU-registered exchange |
| Sell for INR or swap into USDT “to be safe” | Yes, 31.2% on any gain | Yes, on the sale value | A tax bill you didn’t need |
| Swap BTC for ETH on the way out | Yes, it counts as a sale | Yes | Losses on one coin can’t offset gains on another |
The fourth and fifth rows are the trap. Converting to a stablecoin feels safer, but India treats it as selling the original coin. Our crypto swap tax calculator shows how fast repeated swaps add up.
BtcMedia verdict
If there is any doubt about where your hardware wallet came from, move the coins to a wallet created with a brand-new recovery phrase on a device bought from the maker or an authorised seller. Move the same coin, do not trade it, and the move costs you a network fee, not 31.2% of your gains. Trezor says CryptoBilis buyers since March 2026 can contact its support for a replacement device or a voucher.
FAQ
Is transferring crypto from an exchange to my own wallet taxed in India? No. Withdrawing coins you already own to your own wallet is not a sale. Tax applies when you sell, swap or spend them.
Do I need to report wallet-to-wallet transfers in my ITR? Schedule VDA lists each sale with its cost and sale value. A move between your own wallets has no sale value, so it is not listed as one. Keep the transaction IDs to prove your original cost later.
Was any Indian seller involved in the Trezor or Ledger cases? None has been named so far. Trezor’s warning covers CryptoBilis, a Southeast Asian reseller.
How we calculated this: transaction size of about 141 vbytes for a one-input, two-output SegWit transfer, fee rate from mempool.space and BTC/INR from CoinGecko at 10:45 AM IST on 31 October 2026.
This article is for information only and is not financial or tax advice. Check your situation with a qualified tax adviser.