Kaun Banega Crorepati Tax: Know how much tax you have to pay on the amount won in the Kaun Banega Crorepati show.
Kaun Banega Crorepati Tax: Becoming the winner of one of the biggest reality shows in the country, Kaun Banega Crorepati (KBC), is no less than the fulfillment of a dream. But do you know that a huge tax is levied on the prize money won here on the basis of your knowledge. The taxes levied on the prize money won in KBC include flat tax rate, TDS and extra charges like surcharge and cess.
The amount won from the game show is subject to taxation
In India, the amount won from KBC or any other similar game show is subject to taxation under the Income Tax Act. CA Dr. Suresh Surana gave important information related to tax on the amount won in KBC and told how much tax is deducted from the prize money of Kaun Banega Crorepati.
How much tax do KBC winners pay on their winnings?
Flat Tax Rate: Section 115BB of the Income Tax Act, 1961 provides that any amount won from any lottery or crossword puzzle or race including horse race (not being income from the activity of ownership and maintenance of horse riding horses) or card games and other games of any description or from gambling or betting in any form or nature whatsoever shall be taxed at the rate of 30%.
This section taxes income from games that depend on chance or luck rather than skill. Games such as gambling fall under the purview of Section 115BB.
Surcharge and Cess
This amount is taxable at 30 per cent, plus applicable surcharge and cess. Taxpayers cannot claim basic exemption for these winnings and the income will be taxed at the specified rate without any deduction or exemption.
Section 194B
As per Section 194B of the Income Tax Act, a payer is required to deduct TDS at the rate of 30% (plus applicable surcharge and cess) of any such winnings if the amount exceeds Rs 10,000 in a particular financial year. Thus, the amount received by the taxpayer will be net of such TDS. To deduct such TDS, the payer may ask for the PAN and bank details of the winner.
The amount of TDS deducted on behalf of the payer will be shown in Form 26AS of the winner or taxpayer and its credit can be taken by the taxpayer while filing the income return.
Are there slabs for different amounts?
The amount won from KBC will be taxed at the rate of 30% (plus applicable surcharge and cess). There is no prescribed slab for taxation of income falling under the purview of section 115BB in case of amount won through KBC.
Do winners have to pay income tax?
TDS deducted at the rate of 30% on winnings is considered as prepayment of income tax. This amount is credited to the total tax liability of the winner. Recipients have to disclose their winnings and TDS deducted in their income tax returns. They should include the prize money under the heading “Income from Other Sources”. The TDS deducted and shown in Form 26AS (which contains details of TDS collected and deposited) can be claimed as credit against the total tax liability while filing returns.
Some important points
- No basic exemption limit: The basic exemption limit does not apply to winning income. The entire amount is taxable.
- Filing of tax returns: You need to disclose the winning amount while filing your income tax returns and pay any additional tax liability, if applicable.
- No deductions allowed: No deductions are allowed under Chapter VI-A (like Section 80C) against such income.
This taxation applies to all winnings from lotteries, game shows and similar sources.
