How is a crypto SIP taxed in India?

A crypto SIP attracts no tax at the time of investing. The liability arises when you sell. Each instalment is a separate purchase carrying its own cost basis, the gain on sale attracts 30 percent flat under Section 115BBH, and 1 percent TDS is deducted on the transfer itself under Section 194S. Every instalment buys a quantity at that day's price, and that price becomes the cost basis for that lot alone. Instalments cannot be averaged into a single cost basis for tax, even where a platform shows you a blended average for your own reading. When you sell part of a holding you are selling specific lots, and the gain is computed lot by lot. The 1 percent TDS applies to the transfer value rather than the profit, so it is deducted even on a lot you sell at a loss. The TDS is a credit. It appears in Form 26AS and you set it against your final liability when you file. Say 25,000 rupees a month goes into a crypto index for six months. Six instalments buy six separate lots at six different prices, for a total outlay of 1,50,000 rupees. Nine months later the holding is worth 2,10,000 rupees and you sell all of it. The gain is 60,000 rupees. Tax at 30 percent is 18,000 rupees, before surcharge and cess. TDS at 1 percent of the 2,10,000 rupee sale value is 2,100 rupees, deducted at the point of sale and visible in Form 26AS. You pay the remaining 15,900 rupees when you file, and you report the whole position in Schedule VDA. Had one of those six lots fallen in value, its loss would not reduce the gain on the other five. Section 115BBH allows no set-off between virtual digital assets. A Qatobit SIP buys into a QSI index on a fixed date each period, and each purchase is recorded as its own lot with its own cost basis, so your statement carries the figures Schedule VDA asks for. A rebalance inside an index does not create a taxable event for you. Your own sale of the basket does.