A common family tax trick goes like this: one spouse earns more, so the money is moved to the other spouse, who buys the investment and reports the profit at a lower slab. With crypto in India, the trick fails twice. The law sends the profit back to the person who gave the money, and even if it didn’t, crypto gains pay the same flat rate in everyone’s hands.
What Section 99 says
From 1 April 2026, the clubbing rules sit in Section 99 of the Income-tax Act, 2025, which replaced the old Section 64. Under Section 99(1)(a)(ii), an individual’s income includes income arising “directly or indirectly” to their spouse “from assets transferred directly or indirectly” to the spouse “otherwise than for adequate consideration”. A gift is a transfer without consideration.
The Income Tax Department’s own FAQ on clubbing of income closes the obvious loophole. In its example, a husband gifts ₹8,40,000 to his wife, who buys debentures with it; the interest is still clubbed with his income, because “the asset transferred is money, and subsequently the asset takes the form of debentures”. Swap debentures for bitcoin and the logic is the same. The same section also covers assets gifted to a son’s wife, and the FAQ says clubbing does not apply only when the transfer is for adequate consideration or part of an agreement to live apart.
The worked example
Say you gift your spouse ₹2,00,000. They buy bitcoin on an Indian exchange and later sell it for ₹3,00,000, a ₹1,00,000 gain. Here is how three family set-ups compare.
| Set-up | Whose return shows the gain | Tax on ₹1,00,000 gain | 1% TDS on ₹3,00,000 sale |
|---|---|---|---|
| You buy in your own name | Yours | ₹31,200 | ₹3,000 on your PAN |
| You gift ₹2 lakh, spouse buys | Yours (clubbed) | ₹31,200 | ₹3,000 on spouse’s PAN |
| Spouse invests own savings | Spouse’s | ₹31,200 | ₹3,000 on spouse’s PAN |
The tax line never moves. Crypto gains are taxed at a flat 30% plus 4% cess (31.2%), with no deduction except the cost of acquisition and no set-off of losses, so a lower-earning spouse pays exactly what a top-slab earner pays. You can check the number with our crypto tax calculator.
Where clubbing actually bites: the paperwork
Since the rate is identical, the real cost of putting crypto in a spouse’s name is administrative. The exchange deducts 1% TDS against the PAN of the account holder, so the ₹3,000 shows up in your spouse’s AIS and Form 26AS. The gain, meanwhile, belongs in your Schedule VDA. Your spouse’s return shows TDS with no matching income, and yours shows income with no matching TDS.
Under the old Income-tax Rules, Rule 37BA let the person whose income was clubbed claim that TDS credit through a declaration by the deductee. Ask a tax professional how the current rules handle it before you file, and use our TDS reconciliation tool to line up what each AIS shows. A mismatch like this is the kind of gap the tax department’s AIS nudges pick up.
Gifts themselves are tax-free
None of this makes the gift taxable. A spouse is a “relative”, so crypto or cash gifted to them carries no tax on receipt, as our crypto gift tax calculator and gift tax guide explain. Clubbing only decides whose return reports the income that the gift later earns.
What it means for Indian investors
- Moving money to a spouse to buy crypto saves no tax. The gain is clubbed back to you, and the rate is 31.2% for both of you anyway.
- If your spouse genuinely invests their own savings, the gain is theirs to report. Keep bank records showing where the money came from.
- If you have already gifted money that went into crypto, report the gain in your own return and sort out the TDS credit before filing.
BtcMedia verdict
For stocks and mutual funds, family investing in a spouse’s name is an old slab-shopping idea, and clubbing exists to stop it. For crypto, there is no slab to shop for. The only things a spouse’s account changes are whose PAN gets the TDS and how messy filing becomes. Keep crypto in the name of the person whose money bought it.
FAQ
Is crypto bought with money gifted to my wife taxed in my hands? Yes. Under Section 99(1)(a)(ii), income from an asset gifted to a spouse is added to the giver’s income, and the tax department says this holds even when the gifted money is turned into a different asset.
Does my spouse pay less tax on crypto because they earn less? No. Crypto gains are taxed at a flat 30% plus 4% cess regardless of the holder’s other income, so a ₹1 lakh gain owes ₹31,200 in either name.
Is a crypto gift to my husband or wife taxable? No. Gifts from a relative, including a spouse, are not taxed on receipt. Only the later income from the gifted asset is clubbed.
How we calculated this: ₹1,00,000 gain × 30% = ₹30,000, plus 4% cess of ₹1,200, for ₹31,200; TDS is 1% of the ₹3,00,000 sale value. Rules per the Income-tax Act, 2025 Section 99 and the Income Tax Department’s clubbing FAQ, checked 1 November 2026, 10:50 AM IST.
This is general information, not financial or tax advice. Check your own situation with a qualified tax professional.