Section 194G: TDS Rates for Commission, Price, etc. on sale of lottery tickets

^{The person responsible for paying any income by way of commission, remuneration or Prize on lottery ticket has to deduct tax @ 10% at the time of credit to the recipient account, or at the time of payment in cash or issue of cheque/draft any other mode, whichever is earlier. However no tax is to be deducted, if the amount does not exceed Rs.1000/-.}

^{Further assessee can make an application in Form 13 to the Assessing Officer, who shall after satisfying himself, issue a certificate that total income of the person who is or has been stocking, distributing, purchasing or selling lottery tickets justifies the deduction of tax at a lower rate or no deduction of tax at all.}

The updated chart of tax Deduction at Source for FY 2015-16 or AY 2016-17 is as under:

Reference:

As Per Section 194G, of the Income Tax Act, 1961-

Commission, etc. on the sale of lottery tickets.

1. Any person who is responsible for paying, on or after the 1st day of October, 1991 to any person, who is or has been stocking, distributing, purchasing or selling lottery tickets, any income by way of commission, remuneration or prize (by whatever name called) on such tickets in an amount exceeding one thousand rupees shall, at the time of credit of such income to the account of the payee or at the time of payment of such income in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rate of ten per cent.
2. Where the Assessing Officer is satisfied that the total income of any person who is or has been stocking, distributing, purchasing or selling lottery tickets justifies the deduction of income- tax at any lower rate or no deduction of income- tax, as the case may be, the Assessing Officer shall, on an application 7 made by such person in this behalf, give to him such certificate as may be appropriate.
3. Where any such certificate is given, the person responsible for paying the income referred to in sub- section (1) shall, until such certificate is cancelled by the Assessing Officer, deduct income- tax at the rates specified in such certificate or deduct no tax, as the case may be.] Explanation.- For the purposes of this section, where any income is credited to any account, whether called” Suspense Account” or by any other name, in the books of account of the person liable to pay such income, such crediting shall be deemed to be credit of such income to the account of the payee and the provisions of this section shall apply accordingly.

Purchasing or selling lottery tickets, any income by way of commission, remuneration or prize (by whatever name called), on such tickets in an amount exceeding Rs. 1, 000 shall, at the time of credit of such income to the account of the payee or at the time of payment of such income in cash or by issue of a cheque or a draft or by any other mode, whichever is earlier, deduct income- tax thereon at the rate of 10 (plus surcharge, referred in para 3). It is clarified in this regard that where any such income e. g. commission, remuneration, etc., is credited to any account, whether called” Suspense Account” or by any other name, in the books of account of the person liable to pay such income, such crediting shall be deemed to be credit of such income to the account of the payee and the tax will have to be deducted at source. The tax deducted at source should normally be paid to the credit of the Central Government within one week from the date of deduction. The person deducting the tax should furnish a tax deduction certificate in Form 16A and should also obtain the tax deduction account number. An annual return in Form 26H should be filed by 30th June.