With the rapid growth of online real-money gaming (RMG) in India, platforms like Zupee have become increasingly popular for games such as Ludo, Snakes & Ladders, and other skill-based contests. However, alongside this growth comes the responsibility of regulatory compliance. GST (Goods and Services Tax) and TDS (Tax Deducted at Source) are key areas where players often have questions.
Understanding how these taxes apply to deposits, winnings, and withdrawals is crucial for transparency and avoiding surprises during gameplay or cashouts. This article breaks down Zupee GST and TDS policy, explaining what players need to know about the tax structure, legal obligations, and how it impacts their gaming experience.
Why GST & TDS Matter in Online Games
As more people dive into real-money games on platforms like Zupee, financial transparency and regulatory compliance have become more critical than ever. That’s why the two key components of this compliance, GST (Goods and Services Tax) and TDS (Tax Deducted at Source), can’t be overlooked while playing online games.
Government Regulations on Skill-Based Games
In India, skill games are accepted by law and are considered different from games of chance. The Supreme Court sees Ludo, rummy, and fantasy sports as mostly skill-based, which means Zupee and other platforms can run legally following the right rules. Being a real money skill-based game, the government has made specific provisions for GST and TDS applicability on online money gaming like other industries.
Why Platforms Like Zupee Deduct GST & TDS
Under the law, Zupee must, like other gaming platforms, collect GST and deduct TDS from certain transactions. This way, organizations are following the regulations set by both the Income Tax and the GST Law. The GST is charged on deposit amounts, but TDS is levied only on net winnings.
These deductions serve a dual purpose:
- Maintain financial transparency and regulatory compliance.
- Safeguard players by adhering to the law.
Zupee GST Policy – What Is the GST Rate for Ludo & Other Games?
The government of India has introduced a clear tax framework for online real-money games, including popular skill-based platforms like Zupee. Understanding how GST applies to these games is essential for players participating in paid contests and tournaments.
What Is the GST Rate for Online Games in India?
According to the current regulations, a uniform GST rate of 28% applies to skill-based online games. This policy was introduced with effect from October 1, 2023, to introduce specific provisions under the GST law and streamline tax treatment across gaming platforms.
Zupee GST Rate Breakdown
Zupee applies the 28% GST rate on the deposits made by users to participate in skill-based games such as online Ludo, Snakes & Ladders, and others. For instance, if you deposit ₹100 on the platform, ₹21.88 may be collected as GST. However, Zupee may reward a certain cashback or bonus, which might result in getting a full amount of deposits and can be further used as a discount from the entry fees.
Is GST Applicable on Paid Tournament?
When a player joins a paid tournament on Zupee, an entry fee is charged to the user. Since GST is already charged at the time of deposits made on the platform, no GST is applicable on entry fees paid by the player to join the tournament.
Is There Any GST on Withdrawals?
No, GST does not apply to the withdrawal of winnings from the Zupee wallet to a linked bank account. However, effective April 1, 2023, TDS (Tax Deducted at Source) at the rate of 30% will be applicable on net winnings at the time of withdrawal, as per Section 194BA of the Income Tax Act. However, TDS will not be deducted if the net winnings are negative at the time of withdrawal or at the year’s end.
For more information, you can check Zupee’s terms and conditions.
Zupee TDS Policy – Tax Deduction on Winnings
To comply with Income tax provisions, Zupee deducts TDS on players’ net winnings from online games, ensuring transparency in reporting and compliance with regulations and promoting responsible gaming.
What Is the TDS for Winning Games in India?
As per the provisions of section 194BA of the Income Tax Act, any winnings from online games are subject to TDS. For gaming platforms like Zupee, the TDS at the rate of 30% is to be deducted from net winnings, which is computed by reducing the amount of deposits from the prize money or withdrawal amount. This regulation was introduced to ensure that winnings from online gaming are properly reported, compiled and taxed as per Indian laws. The computation of net winnings has been explained in the next section.
When Does Zupee Deduct TDS?
Zupee deducts TDS in the following circumstances:
- At the Time of Withdrawal: When a user requests a withdrawal from the winnings wallet to their bank account. The TDS on Net Winnings are to be calculated as follows:
Net Winnings = Total Withdrawals − Total Deposits − Opening Balance. - End of the Financial Year: TDS on the year-end balances will be calculated as follows:
Net Winnings = Total Withdrawals + Closing Balance− Total Deposits − Opening Balance- Net winnings comprised in earlier withdrawals.
PAN Requirement for Withdrawals
Zupee allows users to withdraw their winnings even without providing a PAN card. However, to claim the credit for any Tax Deducted at Source (TDS), it is mandatory to submit a valid PAN. Users will be eligible to claim TDS credit if a valid PAN card is provided. To ensure full compliance and maximize your tax benefits, it’s recommended to update your PAN details on your Zupee account.
Form 26AS & TDS Certificate Availability
Zupee provides details of TDS deductions in the player’s account section, which are also reported to the Income Tax Department. Players can:
- View TDS deductions in their Form 26AS on the Income Tax portal only if a valid PAN card is provided.
- Request or download TDS certificates (Form 16A) issued by Zupee to a player subject to the availability of a valid PAN card. You can download the TDS certificate from your Zupee Account > Help & Support > TDS Details > TDS Certificate.
These documents are essential for claiming any eligible tax refunds, if any, in the income tax return.
How to Check GST and TDS Deductions on Zupee
Zupee offers a transparent system for players to track their tax deductions. Here’s how you can check GST and TDS details:
- Log in to your Zupee account.
- Now, go to the wallet section by clicking on the total amount shown at the top right corner of the app.
Scroll down and click on “Transaction History” to view the detailed breakdowns of GST collections on your transactions.