Taxes on Gambling Winnings

The number of gamers in India’sgambling business has increased dramatically over the last decade. Which means that the questions of how much taxes on gambling winnings Indian players will pay is on every gambler’s mind.

The rise in online gambling and gamblers is due to the fact that millions of Indians now have access to high-speed internet at relatively inexpensive fees, allowing them to play at betting sites that were previously unavailable to them.

The legality of online betting sites in India is still a concern, but international online bookies have discovered legal loopholes to provide their services to Indian players legally.

However, from the point of views of the player, it is critical to be aware of the betting taxes that online gambling earnings are subject to.

Betting Tax India

All earnings from the best betting bookies are included in your annual income. In all Indian states, this income is totally taxable as tax on online gambling winnings. This income must be reported in your annual tax return under the heading “Income from other sources.”

Section 115BB of the Income Tax Act covers all tax data related to such income. This section details gains from sports betting, casinos, and other comparable sources.

There is tax on online gambling winnings at a flat rate of 30%, regardless of the tax band in which the person falls. There are no exemptions for this amount. It is obligatory by law to report these earnings on your annual tax return.

It is vital to note that this tax is accompanied with an additional cess. After cess, the net rate is around 31.2 percent. The cess is fixed at 4% and is added to the amount of tax owed by those whose income is subject to income tax.

The tax amount is automatically deducted when the player makes a withdrawal from the site as part of the Tax Deducted at Source (TDS) regulation for gambling operators that are allowed to legally operate and pay taxes in India (such as Indian rummy sites).

When a player makes a withdrawal from an overseas online bookmakers with no legal presence in India, the player receives his entire winnings. This implies that he is the one responsible for declaring the betting tax on his annual tax return.

Betting Tax is Proportionate to How Much You Play

Additional surcharges apply to wins of more above Rs. 50 lakhs, according to Indian tax laws. Winnings that come in excess of Rs. 50 lakh are subject to a 10% surcharge over the standard rate. Taking off the cess, it comes to 33%. After adding the cess, the overall tax rate is 34.32 percent.

Winnings that come over Rs. 1 crore are subject to a 15% surcharge over the standard rate. After adding the cess, the overall tax rate is 35.92 percent. This means that your gambling tax rate all depends on how much you play. The more you play, the more you pay!

Leave it to the Professionals

It is vital to reveal the exact amount of money earned from casino in India online in order to play lawfully. When filing your tax returns, you must include this income (ITR). If the taxable amount was not deducted at the source, it is critical to pay your taxes on time. This will help you keep you from trouble while avoiding a tax fine.

If you need help paying gambling taxes, we suggest that you contact a chartered accountant who will be able to provide you with the most accurate tax guidance.

FAQs about Taxes on Gambling Winnings

Summary of the Gambling Tax Rate

Many betting sites have opened their doors to Indian gamers in recent years. However, there have been an equal number of illegal portals. Remember to mention your online betting winnings when submitting your taxes!

Arjun Jindal | Last Modified: July 29, 2022