TDS FAQ

Why is my TDS getting deducted?

As per the income tax Act, any company/person making a payment is required to deduct tax at source if payment exceeds certain threshold limits. Accordingly, gaming operators are required to cut TDS ( Tax deducted at Source) at the rate of 30% as per law (Section 194B). Pocket52 is a law-abiding online gaming website in India and TDS deduction policy of the website is in compliance with the applicable tax provision of the country.

The TDS Policy at Pocket52 has been recommended by senior tax consultants in India, and proves to be advantageous for both, the players and the gaming industry in the long run.

How is my TDS calculated?

TDS is deducted at the time of withdrawal whenever your winning exceeds Rs 10000. Winnings is calculated as below

[Winnings = Total Withdrawals – Total Deposits (at the time of withdrawal) in current Financial Year (April 1 – March 31)

For example, at the time of attempting a withdrawal of Rs 5000, your Total withdrawals (including current withdrawal amount) for the financial year = Rs 40000 and your total Deposits = Rs 20000. In this case, your winnings would be calculated as below

Winnings for FY = Total withdrawals – Total Deposits = Rs (40000-20000)= 20000

So, the winnings in this case (Rs 20000) exceed Rs 10000, and hence will attract a TDS of 30% on the withdrawal amount

TDS applicable = 30% *(Withdrawal - Tax free amount) = 30% of 5000 = Rs 1500 (Considering there is no tax exemption and Tax free amount is zero)

For the sake of further clarity, you can go through a series of transactions below to understand the TDS process better.

Below are the assumption involved in the transactions

1. All the transactions below are from one particular financial year

2. These are consecutive transactions by the player ie Transaction no 2 in the table happened right after transaction 1 and hereby the respective amounts get carried forward to Transaction 2

Tax free amount is the amount in your wallet balance on which TDS would not be deducted

Is the TDS policy uniform across all games like Poker, Rummy etc?

Yes, the above explained TDS policy is applicable across all games.

How are winnings calculated?

Winnings are calculated as below

[Winnings = Total Withdrawals – Total Deposits (at the time of withdrawal) in current Financial Year (April 1 – March 31)

TDS is applicable on the withdrawal amount when Winnings exceed Rs 10000 at the time of withdrawal.

Where can I view my TDS history?

You can view your TDS history as TDS deductions and Final Withdrawal amounts upto last 2 months in the Transaction history To access the Transaction history Go to the wallet section and click on view transaction history.

What is tax exemption and how much exemption am I allowed?

All users are allowed a maximum of Rs 10000 as tax exemption for the whole financial year.

In case the taxable amount is greater than Rs 10000, the complete exemption limit of Rs 10000 is exhausted. If the taxable amount is lesser than Rs 10000, the player keeps getting TDS exemption till the time Rs 10000 tax exemption limit is exhausted for that particular financial year.

For example, at the time of attempting a withdrawal of Rs 15000, your Total withdrawals (including current withdrawal amount) for the financial year = Rs 40000 and your total Deposits = Rs 20000. In this case, you winnings would be calculated as below

Winnings for FY = Total withdrawals – Total Deposits = Rs (40000-20000)= 20000

So, the winnings in this case (Rs 20000) exceed Rs 10000, and hence will attract a TDS of 30% on the withdrawal amount

Now, TDS exemption of Rs 10000 would be applicable as below

TDS applicable = 30% of (withdrawal amount – tax exemption) = 30%* (15000-10000) = 30%*5000= Rs 1500

What happens to my wallet balance at the end of the financial Year?

At the end of the financial year, your complete wallet balance would be deemed to have been withdrawn, and would attract an automatic TDS exemption of 30% on winnings greater than Rs 10000. The remaining balance ,i.e., previous balance - tds deducted would be reflected as Real cash for the next financial year.

For example

Lets say Real Cash balance a the end of the financial year for a user is Rs 30000

Now, there could be 2 cases for calculation of Real cash for the new financial year (considering Tax free amount is zero)

Case 1 : Winnings in the previous financial year is greater than 10000

In this case, the complete real cash amount would attract a TDS exemption of 30%

Real cash balance (New financial year) = 30000 - 30% (30000) = 21000

Case 2 : Winnings in the previous financial year is less than 10000

In this case, complete real cash amount would be deemed to have been withdrawn without any TDS being deducted

Real cash balance (New financial year) = Rs 30000

In both the cases, the balance for the new financial year would be considered for the winnings calculation for the new financial year.

How and when will I get my TDS certificate?

TDS certificates are shared with our users every quarter on their registered email addresses.

For any further queries, feel free to reach out to us at support@pocket52.com

Wallet Changes (applicable for existing customers*) ?

Pocket52 will be adopting a new wallet (One wallet system) w.e.f 28th December which will replace the current wallet structure on the platform. The new wallet will serve as the sole wallet for all games on the platform to which the user can deposit cash and withdraw money. The new wallet will have two components : Real cash and Bonus Cash. TDS deduction will take place at the time of withdrawal and will be applicable when winnings are greater than Rs 10000.

*Existing customers are the users who signed up with Pocket52 on or before 28th December 2020

What is the difference between Current Wallet and New Wallet (applicable for existing customers) ?

What is Real Cash and Bonus cash?

Real Cash consists of all your deposits (money deposited from bank account to the platform) and winnings (Amount won during gameplay). Real cash component of the wallet is completely withdrawable. One can also withdraw a partial amount if he/she wishes to.

Bonus cash is earned through various sources like referral (by levelling up the pocket vault) , rewards and offer deposits. Bonus cash cannot be withdrawn but can be used for gameplay depending on the capping defined for respective games.

When and what will happen to the wallet of existing customers when the new TDS policy rolls out ?

New TDS policy is applicable from 28th December 2020. For the purpose of TDS policy, the financial year will commence on 28th December 2020 and end on 31st March 2021.

The below mentioned changes will apply to the wallet of existing customers:

For poker money,

Bonus money balance will go to the Bonus Cash component

Redeemable balance will go to the Real Cash component

For user money,

User money balance will go to the Real Cash component

Note: All the previous deducted TDS transactions will not be considered once the new policy rolls out

What will happen to the wallet of existing customers at the end of the financial year i.e. at the end of March 31, 2021 ?

At the end of the financial year, your complete wallet balance would be deemed to have been withdrawn, and would attract an automatic TDS exemption of 30% on winnings greater than Rs 10000. The remaining balance ,i.e., previous balance - tds deducted would be reflected as Real cash for the next financial year (i.e,. starting 1st April 2021)