Frequently Asked Questions about Adda52 New TDS Policy
Effective 2nd January 2020, 7:00 am, Adda52 introduces a new policy for taxation on winnings in ring games, tournaments and Sit & Go. All forms of poker game will be played with VIP chips & prize money will be credited to VIP wallet. TDS will be applicable on Net Winnings calculated at the time of VIP to Poker Wallet Conversion.
New TDS Policy
- 30% TDS will be deducted on Net Winnings of 10,000 & above at the time of VIP to Poker Wallet Conversion
- As per the new policy, Net Winnings will be calculated every time a user coverts VIP Chips to Poker Wallet. Net Winnings = Total Withdrawal – Total Deposit
- The Net Winnings will be calculated based on overall gameplay in a Financial Year.
Note: In the above statement, Withdrawal mean VIP Chips converted to Poker Wallet & Deposit means amount brought into VIP Wallet.
Q. What are VIP Chips?
A. Chips used to play any game of poker (Ring Game/Tournament/Sit & Go) on Adda52 are VIP Chips.
Q. How can I get VIP Chips?
A. To play online poker games on Adda52, you need to transfer your deposit amount from Poker Wallet to VIP Chips. For your convenience, when you take seat on a Ring Game cash table or register into a tournament/Sit & Go, the buy-in amount is automatically transferred to VIP chips from Poker Wallet.
Alternately, you can transfer your poker wallet balance to VIP chips from the game lobby. You just need to go to the “Cashier” tab and then click on “VIP”, Click on “Poker Wallet to VIP” and enter the amount. Once you fill in the amount and click on “transfer” button, appropriate number of chips from your Poker Wallet will immediately be transferred to VIP Chips.
Q. How is VIP winnings credited?
When you leave seat from a Ring Game cash table, your table balance is credited back to VIP Chips wallet. Similarly, when you win a prize in a tournament or a Sit & Go, the amount is credited as VIP Chips.
Q. How is the TDS calculated on winnings?
As stated above, TDS is calculated on Net Winnings of Rs 10,000 & above (Total Withdrawal - Total Deposit) at the time of VIP to Real conversion. Net Winnings is calculated every time you convert VIP to Poker Wallet. This gives you the benefit of covering all wins/losses in a Financial Year.
To understand more, take a look at the below scenarios:
To start, you deposit Rs 1000 in your poker wallet & play ring game cash table. You leave seat with 10,000 which is credited to your VIP Chips Wallet. Now, you convert VIP chips to Poker Wallet.
Net Winnings = 10,000 – 1,000 = 9,000
10,000 will be added your Poker Wallet without TDS. You may withdraw it or reuse to play games.
You put 3000 in your VIP wallet again. With 1000 chips you take seat on a ring game cash table and leave seat with 10,000. This 10,000 gets added to your VIP balance. Your VIP balance is now 12,000.
Again you play a tournament with buy-in 500 & win 10,000. This 10,000 tournament payout is also added to VIP balance. You VIP balance is now 21,500.
Now, you convert VIP chips to Poker Wallet.
Net Winnings = Total Withdrawal (10,000+21,500) – Total Deposit (1,000+3,000) = 27,500 which is greater than 10,000.
30% TDS will be deducted on 27,500. 19,250 will be added to your Poker Wallet after 8250 TDS.
On any day, your net winnings at the time of VIP to Poker Wallet conversion goes below 10,000. Once again, No TDS will be deducted. E.g. Your total deposits in VIP before the end of FY is 40,000 but your total withdrawal till date is 48,000. Hence, no TDS will be deducted.
Q. What is Partial VIP Conversion? How is TDS calculated?
Now users can transfer the chips partially from VIP balance to Poker Wallet without any restrictions.
Whenever a user transfers the partial amount from VIP balance to Poker Wallet, first his winning will be taken out and after that the remaining VIP balance will be taken out. TDS will be deducted as applicable.
In case, his remaining balance has a mixture of IB and Real, then the partial transfer ratio of IB and Real will be the same as the ratio of remaining IB and Real of VIP balance.
Important Rules Regarding TDS calculation on Winnings on VIP tables:
- You may maintain your VIP chips as it is till 31st March of each year, after which Adda52 will automatically transfer all VIP chips to Poker Wallet and deduct tax accordingly based on net winnings for the year. This is done as per Government of India regulations to calculate net winnings of each player for the complete financial year and issue TDS Form 16.
- At the end of every financial year i.e. 31st March, all the VIP sessions are ended and VIP chips are automatically transferred back to your Poker Wallet. This happens without any user action and is mandatory and done automatically by the server. The conversion will be done at 6 AM 31st March.
- Adda52.com calculates TDS on the basis of Section 194B of Income Tax Act. You will get a TDS certificate from us which you can use at the time of filing your annual IT return. We submit the TDS to the government in the first week of every month and file a TDS return every quarter-end. Your Pan number is required to apply for TDS certificate.
- As per the Indian Income Tax Act, every person is liable to pay his due taxes to the government on his own. Adda52.com is not responsible to fulfil player’s personal tax-related liabilities in any situation. It is advisable to hire the services of a professional financial accountant to calculate and file income tax returns.