Annual Information Statement – Receipt of commission etc. on sale of lottery tickets

A new ‘Annual Information Statement’, revising Form 26AS, is recently rolled out by the income tax department. It mainly provides a comprehensive view of various information to the taxpayer. Secondly, for ease of return filing, a simplified ‘Taxpayer Information Summary’ which shows aggregate value to the taxpayer is also made available.

Annual Information Statement allows a taxpayer to view, verify and update the taxpayer information available with the Income Tax Department. Notably, the income tax returns will be pre-filled on the basis of ‘Taxpayer Information Summary’.

The current article deals with one of the information categories covered under AIS namely ‘Receipt of commission etc. on sale of lottery tickets’.

Taxability and TDS provisions relating to ‘Receipt of commission etc. on sale of lottery tickets’

Any income in terms of commission, remuneration or prize earned on stock, distribution, purchase or sale of lottery tickets is taxable under income tax. Provisions of TDS is also applicable to such type of income.

As per section 194G of the Income Tax Act, a person responsible for paying income by way of remuneration, commission or prize on lottery tickets is liable to deduct TDS @ 5% within earlier of the following time-

• Credit of income to the account of the receiver;
• Payment of such income in cash; or
• Payment of such income via cheque or draft or any other mode.

Accordingly, as per law, the person deducting TDS under section 194G is required to file quarterly TDS return in Form 26Q and also issue a TDS certificate, to the deductee, in Form 16A.

AIS Source information for the category ‘Receipt of commission etc. on sale of lottery tickets’-

Annual Information Statement will figure out details like total income; TDS deducted thereon etc. for the said information category on the basis of quarterly TDS return filed by the deductor in Form 26Q.

AIS processing for the information category ‘Receipt of commission etc. on sale of lottery tickets’-

Annual Information Statement will process the information received from the TDS return filed by the deductor in the following manner-

1. Total income on which TDS is deducted and reflected in Form 26Q will be considered as taxable income in the hands of the recipient (deductee); and

2. Such income will be taxable under the income head ‘Income from other sources’.