How to account for withholding tax from betting and gaming

Each one of us wishes for that big lottery win, whether its entry is free or you spend some cash in the gamble. Lady luck does not smile every day and a win from betting could be viewed to be a sign of success.

In the previous years, such winnings have always gone tax-free since there were no provisions in the income tax legislation to tax them. Taxation of winnings was introduced by the Finance Bill 2011 and enacted by the Finance Act 2012 of May 5, 2012. However, the Finance Act 2012 of January 9, 2013 deleted the provisions relating to taxation of winnings from gaming and betting.