Home > Income Tax > Help Center > Taxability on GamblingLast Updated: March 20th 2023
Taxability of winnings from Dream11 or Online Gambling?
Increased Online Gambling and other fantasy sports platforms such as Dream11 brought many Indians into the Tax Network indirectly. Understand all about the Online Gambling, Dream11 and the Taxability on Winnings, TDS and how the tax is calculated for such scenarios.
This document covers
1. Online Gambling
Online gambling (or Internet gambling) is any kind of gambling conducted over the internet. This includes virtual poker, casinos, sports betting and other such means. Most of the countries have restricted or banned online gambling. Online Gambling service providers are required to have registration specified by the Government of the countries.
Bettings like cricket betting, online poker, football betting, or a game of chance or skill, bettings became popular in India, but most of these bettings are unregulated in India.
2. Dream11
Dream11 is an Indian fantasy sports platform that allows users to play fantasy cricket, hockey, football, kabaddi, and basketball. It is an online game where users create a virtual team of real-life players and earn points based on the performances of these players in real matches.
A user who scores the maximum points in their joined contests attains the first rank on the leader-board. Dream11 offers free and paid contests. A user has to pay a certain fee to join a contest and can win real cash.
To participate in a Dream11 game, a user must be at least 18 years old and needs to get their profile verified using their PAN.
3. Taxability of online gambling income
Income received through online gambling is taxable in the hands of recipient.
- Rate of Tax: Income in the nature of online gambling or betting is taxable @ 30% plus surcharge if applicable and Health and education cess @ 4% u/s 115BB.
- Deduction's u/s Chp VIA: No Deductions under Chp VIA (80C to 80U) are allowed.
- Claim of Expenses: No Expenditure or allowance can be allowed from such income.
- Deduction of TDS: TDS needs to be deducted @ 30% if the amount of winning exceeds Rs 10,000. TDS needs to be deducted by the person to whom a specific licence has been granted by the Government. NOTE : W.e.f 01st July 2023, there is no threshold for the TDS deduction. TDS needs to be deducted on net winnings at the end of the financial year
- Basic Exemption Limit: Basic Exemption Limit of Rs 2,50,000/3,00,000 is not allowed in respect of Gambling earnings.
- Taxability of winnings received in Kind or partly in Kind: When the winnings are in kind or partly in cash or in kind, the person who is responsible for payment should ensure that the TDS has been paid to Government and then only he should release the winnings
For more information on IT Filing, Expert Consultation related to Taxability on Dream11 and/or other Online betting income, take the Online Tax Service or Call +91 7288 900 900