Gambling Income Tax Treatment

1189 views 5 replies
hello
one of my client has Income from Salary, Capital Gain from Property, STCL from shares and Gambling Income.
Question is:
he has earned some profit in Gambling on which tax is deducted, and he made losses too in Gambling in later months
Now can the income from gambling be shown as Net of Profit less Losses?
e.g.
He earned a profit of 300000 and made losses of 125000, so what is the income to be reported?
is it 3000000 or 175000 (300000-125000).
please assist
Replies (5)

1. The relevant sections relating to casual income such as winning from gambling are sec 115BB, sec 194B and sec 70. 
2. Income from gambling will be considered as casual income and the same will be chargeable to tax u/s 115BB @ 30%. It is important to note that the entire winnings will be chargeable to tax @ 30%. 
3. At the time of payment of casual income, the payer is required to deduct tax @ 30% on the entire winnings. 
4. Now with respect to loss, sec 70 which deals with set off of a loss on inter source adjustments, had not specifically dealt with a loss under the category casual income. However, an explanation was provided that loss under casual income will not be allowed to be set off against the income under the same source. 
5. In the given case the winnings (and not profit as used by IT) of Rs. 3,00,000 will be subject to tax @ 30 %. This income alone will be subject to tax @ 30% u/s 115BB and TDS will be deducted by the payer u/s 194B and no basic exemption limit will be available to such winnings. 
Please correct me if the above solution has an alternative view. 

u can not setoff such loss to pgbp
u have to report 3l
agree with Mr Suresh
You have to shown under income from other sources and you can't set off of gambling loss with gambling gain. You have to show 3,00,000 and you have to pay 30% flat rate on gain with out any deductions.

Your income is what you withdraw from casino account

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