A vegetable vendor from Rajasthan had bought a lottery ticket for the Diwali Bumper 2025 of Punjab State and won the prize money of Rs 11 crore. The man sells vegetables on a cart. The vendor did not have enough money to buy the ticket, so he borrowed money to purchase it.
He won the first prize, and the amount will be transferred to his account after the income tax on the prize money is deducted.
According to media reports, Amit Sehra won the prize money of Rs11 crore. He is a native of Kotputli in Rajasthan. A few days ago, he visited his friend in Moga, Punjab, and borrowed Rs 1,000, reportedly using the money to buy the lottery ticket. He bought two tickets-one in his own name and another in his wife’s name. The result was declared on October 31. He won prize money of Rs 11 crore, while his wife won Rs1,000.
According to Nav Bharat Times, a chartered account said in India, lottery money prizes are taxed under Sections 115BB and 194B of the Income Tax Act. A 30% income tax is charged on the amount won from a lottery. In addition, a 4% Health and Education tax is also applicable.
It means that on lottery winnings of Rs 11 crore, a 30% tax amounts to Rs 3,30,00,000. On this tax amount, a 4% Health and Education Tax, which is Rs 13,20,000, will be added.
So, the total tax payable on lottery winnings of Rs 11 crore will be Rs 3,43,20,000. Moreover, a surcharge may also be applicable on top of this.
The chartered accountant revealed that Sehra will have to pay surcharge as Rs 11 crore becomes his income for the year. He will have to pay a surcharge of 10% on income between Rs 50 lakh and Rs 1 crore, 15% on income between Rs 1 crore and Rs 2 crore, 25% on income between Rs 2 crore and Rs 5 crore, and 37% on income above Rs 5 crore.
In the case of lottery winnings, the surcharge is applied only on the tax amount, and it is applicable at the highest slab rate.
The CA explained that Amit Sehra will have to pay Rs 3,30,00,000 as base tax. Additionally, he will also pay Rs 13,20,000 as Health and Education Cess, bringing the total tax before surcharge to Rs 3,43,20,000.
Now, applying a 37% surcharge on this amount equals Rs 1,26,98,400.
Thus, Amit will have to pay a total tax of Rs 3,43,20,000 + Rs1,26,98,400 = Rs 4,70,18,400.
In other words, the total tax and surcharge payable comes to Rs 4 crore 70 lakh 18 thousand 400.
The Punjab lottery office will dole out the payment after deducting TDS as per the rules. This means that 31.2% tax will be deducted at source. The cess will also have to be paid separately.
After deducting Rs 3,43,20,000 from the total winning amount of Rs 11,00,00,000, Amit will receive Rs 7,56,80,000 in hand. He will then have to pay the surcharge on his own. Pls keep the text intact
