Under Section 194B of the Income Tax Act, 1961, tax deductions at source (TDS) are required for winnings from various sources, including:
- Lotteries
- Crossword puzzles
- Quiz shows
- Card games (including online games)
- Game shows
- Horse racing
- Other similar income
Key points to remember about TDS under Section 194B:
- Threshold limit: TDS is only applicable if the winnings exceed ₹10,000.
- Deduction rate: The current TDS rate Income Tax for winnings under Section 194B is 30%.
- Who deducts the tax: The person making the payment (lottery organizer, quiz show producer, etc.) is responsible for deducting the Income Tax TDS and depositing it with the government.
- Form for deposit: The deducted TDS Income Tax must be deposited with the government using Form 26QB.
- Tax credit: The deducted TDS can be claimed as credit when filing your income tax return.
Important notes:
- The rate of 30% might be subject to change based on budget announcements or amendments to the Income Tax
- Certain additional charges like chess and surcharges might apply to the deducted TDS.
- It is important to consult with a tax professional for detailed guidance on your specific Income Tax