{"id":7645,"date":"2025-07-11T07:40:36","date_gmt":"2025-07-11T07:40:36","guid":{"rendered":"https:\/\/lemonn.co.in\/blog\/?post_type=glossary&#038;p=7645"},"modified":"2025-07-11T07:40:41","modified_gmt":"2025-07-11T07:40:41","slug":"section-194b-of-income-tax-act","status":"publish","type":"glossary","link":"https:\/\/lemonn.co.in\/blog\/glossary\/section-194b-of-income-tax-act\/","title":{"rendered":"Section 194B of Income Tax Act"},"content":{"rendered":"<p><strong>Section 194B<\/strong> deals with <strong><a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/tds\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>TDS<\/a> (<a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/tax\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>Tax<\/a> Deducted at Source)<\/strong> on money won through <strong>lotteries, game shows, puzzles, or betting<\/strong>.<br>It ensures that a part of the prize money is paid as <strong>tax to the government<\/strong> before you receive it.<\/p>\n\n\n\n<h2 id=\"what-is-covered-under-section-194b\" class=\"wp-block-heading\"><strong>What is Covered Under Section 194B?<\/strong><\/h2>\n\n\n\n<p>TDS applies if you win:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Lottery or lucky draw<\/li>\n\n\n\n<li>Crossword puzzle<\/li>\n\n\n\n<li>TV or online game shows (like KBC, IPL contests, etc.)<\/li>\n\n\n\n<li>Betting on horse races<\/li>\n\n\n\n<li>Gambling or card games<\/li>\n\n\n\n<li>Fantasy sports or online gaming<\/li>\n<\/ul>\n\n\n\n<h2 id=\"tds-rate-under-section-194b\" class=\"wp-block-heading\"><strong>TDS Rate Under Section 194B<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Flat 30%<\/strong> TDS is deducted<\/li>\n\n\n\n<li><strong>No basic exemption<\/strong>, no matter how small or big your other income is<\/li>\n\n\n\n<li>Plus surcharge and cess may also apply<\/li>\n<\/ul>\n\n\n\n<h2 id=\"when-does-tds-apply\" class=\"wp-block-heading\"><strong>When Does TDS Apply?<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>If your winnings are <strong>more than &#x20B9;10,000<\/strong>, TDS must be deducted<\/li>\n\n\n\n<li>Applies to <strong>cash prizes<\/strong>, <strong>gift vouchers<\/strong>, and <strong>non-cash prizes<\/strong> like cars, bikes, phones, etc.<\/li>\n<\/ul>\n\n\n\n<p>If prize is given in kind (like a car), the <strong>organizer must pay tax<\/strong> before handing over the prize.<\/p>\n\n\n\n<h2 id=\"example-1-cash-prize\" class=\"wp-block-heading\"><strong>Example 1 &#x2013; Cash Prize<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>You win &#x20B9;1,00,000 in an online quiz<\/li>\n\n\n\n<li>30% TDS = &#x20B9;30,000<\/li>\n\n\n\n<li>You receive &#x20B9;70,000<\/li>\n\n\n\n<li>&#x20B9;30,000 is deposited to the government<\/li>\n<\/ul>\n\n\n\n<h2 id=\"example-2-car-as-prize\" class=\"wp-block-heading\"><strong>Example 2 &#x2013; Car as Prize<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Car worth &#x20B9;8 lakh won in a lucky draw<\/li>\n\n\n\n<li>You or the organizer must pay &#x20B9;2.4 lakh (30%) as TDS before taking the car<\/li>\n<\/ul>\n\n\n\n<h2 id=\"how-to-claim-the-prize-and-tds-credit\" class=\"wp-block-heading\"><strong>How to Claim the Prize and TDS Credit<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Winner gets <strong><a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/form-26as\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Form 26AS<\/a><\/strong> showing TDS deducted<\/li>\n\n\n\n<li>At year-end, show this prize money in your <strong><a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/income-tax\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Income Tax<\/a> Return (ITR)<\/strong> under &#x201C;Income from Other Sources&#x201D;<\/li>\n\n\n\n<li>Adjust TDS already paid against your total tax liability<\/li>\n<\/ul>\n\n\n\n<h2 id=\"important-notes\" class=\"wp-block-heading\"><strong>Important Notes<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Even if you don&#x2019;t have a PAN, TDS will be <strong>higher at 30% or more<\/strong><\/li>\n\n\n\n<li>You <strong>cannot claim deductions<\/strong> (like 80C) on this income<\/li>\n\n\n\n<li>Winnings must be declared in your tax return<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Section 194B deals with TDS (Tax Deducted at Source) on money won through lotteries, game shows, puzzles, or betting.It ensures that a part of the prize money is paid as tax to the government before you receive it. What is Covered Under Section 194B? TDS applies if you win: TDS Rate Under Section 194B When [&#x2026;]<\/p>\n","protected":false},"author":9,"featured_media":0,"menu_order":0,"template":"","meta":{"footnotes":""},"class_list":["post-7645","glossary","type-glossary","status-publish","hentry"],"blocksy_meta":[],"_links":{"self":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7645","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary"}],"about":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/types\/glossary"}],"author":[{"embeddable":true,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/users\/9"}],"version-history":[{"count":1,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7645\/revisions"}],"predecessor-version":[{"id":7646,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7645\/revisions\/7646"}],"wp:attachment":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/media?parent=7645"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}