Winning a substantial amount on Kaun Banega Crorepati (KBC) can indeed be exhilarating, but it comes with significant tax implications. Here’s a comprehensive guide to understanding the tax on KBC winnings:
1. Flat Tax Rate:
Applicable Section: Under Section 115BB of the Income Tax Act, 1961, any winnings from games, including game shows like KBC, are taxed at a flat rate of 30%.
Additional Charges: This rate is applicable plus surcharge and cess. The surcharge and cess are calculated based on the total income and are added to the base tax rate.
2. Surcharge and Cess:
Surcharge: The rate of surcharge depends on the total taxable income. For individuals with a total income exceeding ₹50 lakh but up to ₹1 crore, a 10% surcharge is applicable. For income exceeding ₹1 crore, a 15% surcharge is applied.
Cess: An additional 4% health and education Cess is levied on the total tax (including surcharge).
3. Tax Deducted at Source (TDS):
Section 194B: According to Section 194B of the Income Tax Act, the payer (i.e., the KBC organizers) must deduct TDS at 30% (plus applicable surcharge and cess) if the winnings exceed ₹10,000 in a financial year.
PAN and bank Details: To deduct TDS, the payer collects the winner's PAN and bank details. The deducted TDS amount will be reflected in Form 26AS, which is a statement showing the TDS deducted and deposited.
4. No Tax Slabs:
No Slabs: There are no tax slabs for winnings under Section 115BB. The entire winning amount is taxed at the flat rate of 30%, plus applicable surcharge and cess, without any deductions or exemptions.
5. Tax Filing and Additional Tax:
Income Reporting: The winnings need to be reported under the “Income from Other Sources” head while filing your income tax return.
Credit for TDS: The TDS deducted is credited against the total tax liability. When filing the return, you should account for the TDS already deducted and check if any additional tax is due.
Additional Tax: If your total tax liability (after considering the TDS) exceeds the amount of TDS deducted, you must pay the difference. This situation can occur if your total income, including winnings, places you in a higher tax bracket or if additional surcharges and cess apply.
6. Important Points:
No Basic Exemption Limit: The basic exemption limit does not apply to winnings. The entire amount is taxable.
No Deductions Allowed: You cannot claim deductions under Chapter VI-A (like Section 80C) against winnings from game shows.
File Tax Return: Report the winnings and TDS in your income tax return, and pay any additional tax if necessary.
About Kaun Banega Crorepati (KBC)
Kaun Banega Crorepati is a popular indian television quiz show hosted by amitabh Bachchan. Contestants answer a series of increasingly difficult questions to win cash prizes. The show is known for its significant prize money, which makes understanding the tax implications crucial for winners.