No TDS on Online Gaming Wins under Rs 100!

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Good news for online gaming enthusiasts and gaming operators. There will now be no TDS(Tax Deducted at Source) on your wins. And for game operators, you won’t have to do compliances for such winnings.

Let’s read this news in detail for better clarity.

Income Tax Department Clarifies TDS Rules for Online Gaming Platforms

The Income Tax department has issued guidelines for Tax Deducted at Source (TDS) in relation to online gaming platforms.

According to these guidelines, if the net winnings from online gaming do not surpass Rs 100 per month, the platforms will not be obligated to deduct tax at the source for the player.

Thus, the TDS Threshold for Online Gaming is now Set at Rs 100 in India.

Also Read about Taxation of Gaming Sector at: GST on online gaming sector 

CBDT Exempts TDS on Withdrawals Below Rs 100

The Central Board of Direct Taxes (CBDT) has issued a circular clarifying the conditions for deducting tax at source under section 194BA of the Act for “insignificant withdrawals.”

Section 194BA of the Act mandates that online gaming platforms deduct income-tax from the net winnings in a person’s user account.

  • The CBDT has clarified that if the net winnings included in the amount withdrawn do not exceed Rs 100 in a month, tax may not be deducted.
  • If the net winnings in the withdrawal exceed Rs 100 in the same month or subsequent month, or if there is no such withdrawal, tax should be deducted at that time.
  • The deductor assumes the responsibility of paying the difference if the balance in the user account at the time of tax deduction under section 194BA of the Act is insufficient to cover the tax deduction liability calculated according to Rule 133.
  • If a transfer is made from one user account to another user account within the same online gaming platform for the same user, it will not be treated as a withdrawal or deposit.
  • Goods and services tax is not included in purposes for valuation of winnings for TDS under Section 194 BA of the Act.

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