Section 194B and Section 194BB – TDS on Winning from lottery or crossword puzzles or horse race

TDS on Winning from lottery or crossword puzzles or horse race - Section 194B and Section 194BBSection 194B deals with deduction of TDS in the case of winning from lottery or crossword puzzles and section 194BB is for TDS deduction in case of winning from horse races.

Section 194B

Under section 194B, any person responsible for paying any amount as winning from followings will attract Tax at Source and the payer has to deduct TDS at the rate of 30% if such amount is in excess of Rs. 10, 000;

  • Winning from lottery; or
  • Winning from crossword puzzle; or
  • Card games; or
  • Any other games

TDS under section 194B has to be deducted at the time of payment. Unlike in other sections Tax to be Deducted at Source should not be deducted at the time of credit of such amount.

If the winning is in kind or partly in kind and partly in cash and such amount is not sufficient for deduction of TDS then the payer responsible for paying such winning amount should ensure that Tax at Source has been deducted and paid prior to handing over the prize to the winner. Proof of Tax Deduction at Source remittance should be handed over to the payee. The payer can also recover the tax amount from the winner before handing over the prize.

The payer should include the winning amount while filling income tax return under the head “income from other sources” and calculate tax liability after taking credit of the TDS amount deducted from source.

Section 194BB

Any person, being a bookmaker or a person to whom a licence has been granted by the Government under any law for horse racing in any race course or for arranging for wagering or betting in any race course, who is responsible for paying to any person any income by way of winnings from any horse race in an amount exceeding Rs. 5000 shall, at the time of payment thereof, deduct TDS at the rate of 30%.

Finance bill of budget 2016-17 proposed to increase the limit of Rs 5000 as allowed under section 194BB to Rs 10, 000 with effect from the 1st day of June, 2016.

12 thoughts on “Section 194B and Section 194BB – TDS on Winning from lottery or crossword puzzles or horse race

    1. YFB

      TDS deducted under section 194B has to be deposited with government on or before the due date. The person from whom such TDS has been deducted will adjust it with his or her final tax liability at the year end. If he/she is not liable then refund can be claimed for it.

      Reply
      1. aayushi yagnik

        I am a student I have no any income rs 30,000/- deducted from 194 b for radio 93.5 f.m compitation I have refunded 30,000/-

        Reply
  1. Vishnu Santhosh

    I have income only from 194B section. I dont have any other income. In this case which form I have to use ITR2 or ITR2A?

    Reply
  2. Sivaguru

    Is the TDS deducted under section 194B eligible for refund if the total income does not exceed the basic exemption limit?

    Reply
    1. Sanjeev Mahajan

      No, TDS deducted under section 194B is not eligible for refund , even if the total income does not exceed the basic exemption limit.

      Reply
  3. BALAJI

    WHETHER TDS MAY BE DEDUCTED IF WINNING AMOUNT PAID IN PARTLY CASH AND PARTLY KIND.IF YES ANY CASE LAWS

    Reply
  4. BALAJI

    AS PER SEC 194 BB ANY TDS HAVE TO BE DEDUCTED IF WINNING AMOUNT PAID PARTLY IN CASH AND PARTLY IN KIND. ANY CASE LAWS RELATING TO IT

    Reply
  5. shaik liyakat

    How to deduct lottery winning amount I mean tds by deductee I it’s an benefit to deductor or deductee pls give eq

    Reply
  6. Madhava

    I won in ace2three game 26000 they deducted 30% amount as tds and give money 20000 rupees to me..Iam elgible for applying for tds refund

    Reply

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