Cash prize from coaching classes

I dnt think prizes awarded by coaching classes to students would be subject to TDS. Also, it cannot be treated as lottery

Under Section 194B of the IT Act , 30 per cent tax is deducted on any PRIZE MONEY in excess of Rs 10,000 and other winnings from games, lotteries etc. 

Act says any prize money, hence in my view TDS u/s 194B is applicable.

@ CA Gaurav but Section 194B deals with winning from lottery or crossword puzzle...kindly correct if i'm wrong.

as per my knowledge, tds for the same is not liable....

My friend Kulwant,

Sec 194B says any prize money and other winnings from games, lotteries etc.

Sec 194B donot only deal with lotteries & cross word puzzles.Hence in my view cash prizes given by coaching classes comes under prize money and will attract TDS u/s 194B

Dear All,

Agreed With Mr. Gaurav.

Winning from lotteries, crossword puzzles, card games and other games of any sort. For this purpose, “Lottery” includes winning from prizes awarded to any person by draw of lots or by cheque in any other manner whatsoever, under any scheme or arrangement by whatever name called. Further the expression “Card game and other game of any sort” includes any game show, any entertainment programme on television r electronic mode in which people complete to win prizes or any other similar game.

Deduction at what time?

Tax is to be deducted at the time of making payment. Thus if the prize is paid in installments, the deduction of tax shall be made at the time of each installment. (However keep in mind that the exemption limit of Rs.10000/- is per winning and not per payment).

Prize in kind :

If the winnings are wholly in kind or partly in kind but the part is cash is not sufficient to meet the TDS liability, the payer shall before releasing the winning, ensure that the tax has been paid by the payee.