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TDS from winning of lotteries or crossword puzzles – Sec 194B

U.C Date : 25 Feb 2015

TDS is deductible from the payment of winnings from lotteries, puzzles, card games or other games, exceeding Rs. 10,000 at the rate of 30% . Where the prize is partly in cash and partly in kind, then TDS is deductible on total prize i.e cash + value of prize in kind, from the cash portion of the prize. Provided that in a case where the winnings are wholly in kind or partly in cash and partly in kind but the part in cash is not sufficient to meet the liability of deduction of tax in respect of whole of the winnings, the person responsible for paying shall, before releasing the winnings, ensure that tax has been paid in respect of the winnings.

No tax is deductible from bonus or commission payable to agents or sellers of lottery tickets. Circular no. 257, June 4, 1979.

Bare Act for Sec 194B

Bare Act for Sec 194B

The person responsible for paying to any person any income by way of winnings from any lottery or crossword puzzle [or card game and other game of any sort] in an amount exceeding [ten thousand rupees] shall, at the time of payment thereof, deduct income-tax thereon at the rates in force :
[Provided that in a case where the winnings are wholly in kind or partly in cash and partly in kind but the part in cash is not sufficient to meet the liability of deduction of tax in respect of whole of the winnings, the person responsible for paying shall, before releasing the winnings, ensure that tax has been paid in respect of the winnings.]

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