Online / Skill Gaming Compliance Checklist — Sec 194BA, GST Rule 31B
ONLINE / SKILL GAMING COMPLIANCE CHECKLIST
Entity: {{client_name}} · Year ended: {{period_end}}
Purpose: test TDS on net winnings from online games (Sec 194BA), GST on the full face value of bets (Sec 15(5) / Rule 31B), and state-level gaming law compliance.
A. Section 194BA — TDS on net winnings
| Test | Result / Observation |
|---|
| Net winnings are computed per user account for the financial year per Rule 3B's prescribed method (comparing withdrawals and closing balance against non-taxable deposits and opening balance, net of amounts already taxed on an earlier withdrawal in the year) — verify the platform's computation engine implements Rule 3B exactly, not an approximation | |
| TDS at the applicable rate is deducted at the time of withdrawal AND at the end of the financial year on any remaining net winnings in the user's account, not only at withdrawal | |
| No threshold/exemption limit applies under Sec 194BA (unlike the erstwhile Sec 194B) — TDS applies to net winnings of any amount once computed as positive | |
| Winnings wholly in kind (e.g. a car, gadget) where there is no cash component to withhold from are handled per the "responsible person ensures tax is paid before release" mechanism | |
B. GST — Rule 31B (online gaming) / Rule 31C (casinos)
| Test | Result / Observation |
|---|
| GST is charged at the prescribed rate on the full value of amounts paid or payable by/on behalf of the player (the entry amount/bet value), not only on the platform's net revenue/rake | |
| Amounts returned or refunded to a player for a cancelled/withdrawn/aborted game are correctly excluded from the taxable value for that specific transaction | |
| Winnings used by a player to place a further bet (re-investment within the platform) are included in the taxable value of that subsequent bet, not netted off | |
| The distinction between "game of skill" and "game of chance" — relevant historically, though GST treatment has since been made uniform for online gaming — is documented for any residual state-law implications | |
C. State-level gaming law variance
| Test | Result / Observation |
|---|
| States where the platform operates/is accessible have been checked individually for skill-gaming bans or restrictions (gaming law is a state subject and varies significantly) | |
| Self-exclusion, age-verification (18+), and responsible-gaming disclosures required under the IT Rules 2021 (as amended for online gaming intermediaries) are in place | |
| Registration with a self-regulatory body (SRB), where the applicable framework requires it, is current | |
D. Conclusion
Conclusion on Sec 194BA TDS compliance, GST treatment, and state-law compliance: ____________________________________________
| Prepared by | Reviewed by | Engagement partner |
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