Mangal Prasad of Kaushambi won Rs 4 crore on Dream11 by entering just ₹ 39. But, Mangal Prasad will not get the full 4 crore rupees. Let’s know how much tax will be levied on this and what will Mangal Prasad have to do in terms of tax?
Dream11 Winner Tax: The fate of Mangal Prasad, a resident of Ghasi Ram Purwa village in Kaushambi district of Uttar Pradesh, has become a topic of discussion on social media. 30-year-old Mangal, who works in a simple plywood factory, won Rs 4 crore by entering just ₹ 39 on the Dream11 fantasy sports platform. He placed this bet during the IPL match between Punjab Kings and Chennai Super Kings on 29 April.
But Mangal will not get the full 4 crore rupees in hand. Under the tax laws of India, there is a huge tax deduction on such prizes. This reduces Mangal’s actual amount to ₹ 2.44 crore.
Why will he get only ₹ 2.44 crore?
Dream11 winnings are considered as ‘Income from Other Sources’ under Section 56(2)(ib) of the Income Tax Act, 1961. Let’s understand how tax is calculated on this?
- Winning amount: ₹4,00,00,000
- Flat tax rate: 30% (under Section 115BB)
- Effective tax including surcharge and cess: Around 39%
- TDS deducted by Dream11 (under Section 194B): ₹1.56 crore
- Total amount received by Mangal: ₹2.44 crore
- If the winning amount on Dream11 is more than ₹10,000, the platform is legally required to release the amount only after deducting TDS.
What does Mangal have to do in terms of tax?
Although TDS has already been deducted, Mangal still has to complete some important tax compliances so that he does not face any further problems.
His entire income of ₹4 crores has to be shown in the Income Tax Return (ITR) of the financial year.
TDS entry has to be confirmed in Form 26AS.
It has to be ensured that there is no difference between the tax deducted by Dream11 and the tax credit shown in Form 26AS.
Mangal has also paid GST
Not only income tax, the government has also received a share on Mangal’s ₹39 entry. Out of this amount, Dream11 deducted ₹9.92 as GST, which they have to deposit to the government. Fantasy games in India attract 28% GST, which the platform collects while playing.
