It may also be noted that no benefit of basic exemption limit is allowed while calculating the tax dues on this income. No deduction of any expenditure or allowance in connection with such income is allowed while computing such income,” says Kapil Rana, Founder & Chairman, HostBooks Ltd. In general, the payer or disburser of prize money deducts tax at source (i.e., TDS) from the winnings under Section 194B and pays only the balance amount to the winner. Income from such winnings is liable to a flat rate of tax at 30% without any basic exemption limit. Under Section 115BB, a tax rate 30% + Surcharge (if applicable) + 4% Cess are charged on such income. “Provisions of Section 115BB of the Income Tax Act, 1961 govern the tax rate and the procedures. Thus, income from KBC, TV Shows and online gaming forms part of the Income from Other Sources and is taxable under the head Income from Other Sources. Such income is taxable at a flat rate of 30% plus applicable surcharge and cess as per Section 115BB,” says Sudhakar Sethuraman, Partner, Deloitte India. “Accordingly, income from KBC TV shows and online gaming is taxable as ‘income from other sources’ under Section 56 of the I-T Act. ‘Other game of any sort’ includes any game show, an entertainment programme on television or electronic mode, in which people compete to win prizes. Tax Benefits u/s 80D: How to divide health insurance premium to claim deduction for more than 1 year
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