Crypto Business Income setup in India

[mightjustask]

Hi, first of all, very happy to have found this forum... Awesome community

I have a service which I provide and 90% of my payments are in crypto, 10% Paypal, for crypto payments I used Coinbase Commerce + Woocommerce, withdrawal to Binance and then Binance P2P to withdraw via Paypal. This whole flow costs me 12-14% per transaction.
Old flow Summary) Coinbase Commerce --> Binance --> P2P --> Paypal --> Indian Bank

Lately I'm looking at a crypto processor TripleA based in Singapore, has anyone had experiences with this company? Basically they invoice and process payments as well as allow you to withdraw via ACH/Wire. I have setup a SMLLC in WY, US, got Mercury.com and will withdraw from TripleA to Mercury via ACH. From Mercury Wire transfer to PingPongx, then to Indian Bank account.
New flow Summary) TripleA(0.8% processing fee)--> Mercury(Free)--> PingPongx(1% Conversion fee) --> Indian Bank
I could also do a International Wire from Mercury to Indian bank, but Bank conversion rate would be higher than 1% (My theory)

Would like feedback on the new flow?

Secondly, I have no Idea how SMLLC would be taxed in India? Currently I get taxed on all Paypal income as export of service in India. Not sure how the new flow will change things for me? Any inputs would be greatly appreciated...

 

[troubled soul]

I have no Idea how SMLLC would be taxed in India? Currently I get taxed on all Paypal income as export of service in India. Not sure how the new flow will change things for me? Any inputs would be greatly appreciated...

Any foreign entity which is control and managed from India are consider as Domestic Company. And Tax as Domestic Company on its world wide income.
If you earning sound income ,
Dear Better to Move to tax free country . Dubai will be best option for it. Best for Crypto income also.

Any country where income tax apply, Crypto related activities are very risky. Better to play safe.

 

[mightjustask]

And Tax as Domestic Company on its world wide income.

Ok so my income tax will be as before, In India I go as sole proprietor. Also, any idea if I need to charge GST in India or get a GST registration, I make about $50K(37 Lacs INR) per year with this business.

Any country where income tax apply, Crypto related activities are very risky. Better to play safe.

This was my reason to start LLC in the first place, that way LLC acts like a layer between crypto payment gateways and Indian Banking, From an Indian point of view it's software consulting/engineering income.

 

[troubled soul]

Ok so my income tax will be as before, In India I go as sole proprietor. Also, any idea if I need to charge GST in India or get a GST registration

GST is new and rules and Regulation changing everyday.

Better to hire some tax lawyer. Do not trust online forum so much regarding GST.

, I make about $50K(37 Lacs INR) per year with this business. This was my reason to start LLC in the first place, that way LLC acts like a layer between crypto payment gateways and Indian Banking, From an Indian point of view it's software consulting/engineering income.

If you are earning less that 100k per year. That there is no need to do this LLC drama.


I am not expert. Just do it your own risk .
I am suggesting you one route
GST is not apply for freelancer for less than INR 20 Lakhs turnover annually.

How many people in your family which are not employed ?

Do open account name on Your mother/sister/wife name.

Your account -> collect 19 lacs per year
Your Your mother/sister/wife -> collect 19 lacs per year

In this route you can save tax also. and No GST required because It is below the threshold.

Simply PayPal P2P works for your need.
As It is not huge amount. There will be no problem. No need to form LLC and another sort of things.

In future,
As I suggest you in early post, If you earning more than one Crore INR or 200k USD, better to move tax free country like UAE Dubai.

 

[mightjustask]

Noted, will consult a tax consultant locally for GST.

Your Your mother/sister/wife -> collect 19 lacs per year

All of them work professionally and earn and have their own taxes to deal with, not an option

As I suggest you in early post, If you earning more than one Crore INR or 200k USD, better to move tax free country like UAE Dubai.

This is not an option I'm willing to explore, need to be residing in India itself, hence ignored

Simply PayPal P2P works for your need.

No, The fees are high compared to LLC setup, for using verified merchants you get 95 cents on the dollar using P2P, then Paypal has it's receiving fee which is about 5%, then another conversion fee about 4% to withdraw to bank account

If you are earning less that 100k per year. That there is no need to do this LLC drama.

Assume, I'll be making 100K+ in the next FY, obviously I'm looking at future. For this does LLC act as a good enough layer for crypto payments?