In India, lottery winnings are considered as income from other sources and are taxable under the Income Tax Act, 1961. This applies to both domestic and international lottery winnings.
The tax rate on lottery winnings is 30% plus applicable cess and surcharge. Winners must declare such income in their tax returns under the head \“Income from Other Sources\“.
For lottery winnings from outside India, the amount received is converted to Indian rupees using the exchange rate on the date of receipt. The entire winning amount is taxable in India, regardless of whether tax was deducted at source in the foreign country.
Taxpayers can claim foreign tax credit under Double Taxation Avoidance Agreements （DTAA） if India has such an agreement with the country where the lottery was won. This helps avoid double taxation on the same income.
Failure to disclose foreign lottery winnings can lead to penalties and legal consequences under the Black Money Act. It\“s essential to maintain proper documentation of the winning ticket, payment receipts, and foreign tax paid, if any. |
