PokerBuddy365 TDS Policy
Effective 1st December 2020, PokerBuddy365 introduces the TDS policy for taxation on winnings in all cash games. TDS will be applicable on Net Winnings calculated at the time of Poker bonus to real money withdrawal.
Following is the policy:
- If you win, the winning amount will be taxable at the flat rate of 30% which after adding cess will amount to 31.2%.
- 28% GST will be deducted
- It does not matter whether the income of the winner is taxable or not. The prize distributor is liable to deduct tax at the time of payment.
- TDS will be applicable if the amount exceeds Rs 10,000. This means that the first 9,999 winnings will be TDS free. So, TDS will be calculated on Net winnings – 9,999.
- As per the TDS policy, Net winnings will be calculated every time the player converts the winning amount to his wallet. For that, Total winnings= Total withdrawal- Total deposit.
- NOTE: Withdrawal refers to the poker chips converted to real money and Deposit refers to players’ real money being converted to poker chips.
- TDS is calculated only above the net winnings of Rs. 10,000. Net winnings are estimated every time you try to convert poker chips to real money. Check out the following instances for better understanding:
- To begin, deposit INR 1,000 in your wallet and convert that into poker chips to be able to play games. Suppose you exit the seat with 10,000 poker chips. Now you have to convert poker chips to wallet, your net winnings will be:
10,000- 1,000= 9,000. But INR 10,000 will be added to your real wallet without any TDS deduction. You may withdraw it or reuse it.
- Deposit INR 5000 from your real wallet to poker chips. Using 1000 chips you take a seat and suppose you leave the table with 10,000 chips. Then you have a total of 14,000 poker chips.
Now again you play a game using 500 poker chips and win 10,000. These 10,000 poker chips you won are also added in to the total winnings, making the balance to be 23,500. Now you want to convert these poker chips to real money wallet, then
Net winnings = Total Withdrawal (10,000+ 23,500) – Total Deposit (1,000+ 5,000) = 29,500.
Since 29,500 is greater than 10,000, hence liable to tax deduction. 30% tax will be deducted on 19,500. 23,650 will be added to your wallet after the 5850 TDS deduction.
- If anyday, your net winnings in poker chips go below 10,000, no TDS will be deductedFor Eg. If your total poker chips is 40,000 but your withdrawal is 48000, so no TDS will be deducted.
Rules regarding TDS calculation:
- We do not allow partial transfer of poker chips to players’ real wallet. Players have to transfer all the existing poker chips to their wallet all at once, if they want to convert. Net winnings are calculated annually and not for sessions.
- If you wish to, you may maintain your chips until the end of the financial year,i.e. 31st March every year. After this pokerbuddy365 will automatically transfer all the poker chips to the real money wallet, after deducting the taxes as per the government regulations in that financial year.
- At the end of the financial year, i.e. 31st March, all the poker sessions are ended and the money is transferred back to the players’ wallet without any user action. The conversion is done at 11:59:59 PM 31st March.
- We will calculate TDS according to Section 194B of Income Tax Act. You will get a TDS certificate from us which you can use at the time of filing your annual IT return. We submit the TDS to the government in the first week of every month and file a TDS return every quarter-end. Your Pan number is required to apply for a TDS certificate.
- We are not responsible to fulfil player’s personal tax-related liabilities in any situation. It is advisable to hire the services of a professional financial accountant to calculate and file income tax returns.
- To transact anything, i.e. to deposit or withdraw any money into the poker buddy 365 account, KYC completion is mandatory.
- The deposit or net winning in poker chips will be transferred to the real money wallet, the promo code balance will stay in the poker chips only.