Is Freelotto Winning Taxable in India?
One of my friend have got an intimation via mail that he has won 5000 pound sterling in a free lotto game. Now can he get this amount in India and if yes, then how much tax will be deducted from that prize money? Please advice us on this.Subhrajit Gupta
First advice will be to check if the lottery your friend has won is a real one. I myself get ,on an average four to five mails everyday about all sorts of lottery winnings. This is a very big scam .
If your friend has really won, he can certainly bring the lottery winnings in India. However, since your friend is a resident , the winning is taxable. However , in India there can not be any tax at source. But may be in the country where the company is lottery company is situated TDS may be done.
Under the I T Act , the winnings are having special tax rates under section 115 BB . The extract of the said section is given below;
115BB. Where the total income of an assessee includes any income by way of winnings from any lottery or crossword puzzle or race including horse race (not being income from the activity of owning and maintaining race horses) or card game and other game of any sort or from gambling or betting of any form or nature whatsoever, the income-tax payable shall be the aggregate of
(i) the amount of income-tax calculated on income by way of winnings from such lottery or crossword puzzle or race including horse race or card game and other game of any sort or from gambling or betting of any form or nature whatsoever, at the rate of thirty per cent; and
(ii) the amount of income-tax with which the assessee would have been chargeable had his total income been reduced by the amount of income referred to in clause (i).
Therefore, it means that lottery income shall be charged @ 30% irrespective of the fact that you fall under lower tax category.
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