As of 2026, all winnings derived from Andar Bahar on online gaming platforms are subject to a flat 30% Tax Deducted at Source (TDS) on "net winnings" under Section 194BA of the Income Tax Act. This tax is mandatory regardless of the winning amount, as the previous ?10,000 threshold for online games has been abolished. Additionally, players must account for a 28% Goods and Services Tax (GST) levied on the total deposit amount at the time of entry, ensuring that both the stake and the profit are taxed under the current Indian fiscal framework.
The Legal Framework: Section 194BA and Section 115BBJ
The taxation landscape for online gaming in 2026 is governed primarily by two sections of the Income Tax Act introduced to bring clarity to the digital betting and gaming sector. Section 194BA mandates that any person responsible for paying any income by way of winnings from any online game must deduct income tax on the net winnings in the user's account. This applies specifically to platforms offering the Andar Bahar game and other card-based wagering activities.
Complementing this, Section 115BBJ prescribes the tax rate for the person receiving the winnings. For the financial year 2025-26, this rate remains fixed at 30% (plus applicable cess and surcharges). Unlike other forms of income, such as business or salary, players cannot claim any deductions for expenses or losses incurred while playing. The tax is calculated purely on the "net" profit generated within the gaming ecosystem.
Calculating Net Winnings: The CBDT Formula
The Central Board of Direct Taxes (CBDT) has provided a specific mathematical formula to determine the taxable amount for Andar Bahar players. This formula ensures that players are only taxed on their actual profits rather than their total turnover or individual winning rounds. The calculation is typically performed at the time of withdrawal or at the end of the financial year (March 31st).
The formula for Net Winnings is defined as: Net Winnings = (A + D) - (B + C)
- A: Total amount withdrawn by the user during the financial year.
- B: Total amount deposited by the user during the financial year.
- C: Opening balance in the user account at the start of the financial year.
- D: Closing balance in the user account at the end of the financial year.
By using this method, the tax authorities ensure that if a player loses money overall, no TDS is deducted, even if they had individual winning streaks during their sessions. However, the moment a withdrawal is requested that consists of profit, the platform must deduct 30% before the funds reach the player's bank account.
GST Implications for Andar Bahar Players in 2026
While TDS focuses on the profit, the Goods and Services Tax (GST) focuses on the transaction value. Following the 2023 amendments that remain in full effect in 2026, a 28% GST is applied to the "initial deposit" or the "face value" of the chips purchased. This is an indirect tax that the gaming platform collects and remits to the government.
For example, if a player deposits ?1,000 to play and win real cash, the platform may allocate a portion of that deposit toward the GST obligation. This high GST rate was implemented to treat online gaming involving stakes on par with other luxury or "sin" categories, regardless of whether the game is classified as a game of skill or a game of chance.
Comparison of Tax Liabilities for Online Gaming
The following table breaks down the different tax components a player will encounter when participating in Andar Bahar or similar card games in 2026.
| Tax Category | Applicable Rate | Taxable Event | Calculation Basis |
|---|---|---|---|
| TDS (Direct Tax) | 30% | Withdrawal or Year-end | Net Winnings (Profits) |
| GST (Indirect Tax) | 28% | Deposit / Entry | Total Face Value of Stakes |
| Health & Education Cess | 4% of Tax Amount | Annual Filing | Total Income Tax Payable |
| Surcharge | Variable (10% to 37%) | Annual Filing | Only if total income exceeds ?50 Lakh |
Compliance and Reporting Requirements
For players engaging in high-stakes Andar Bahar, compliance with the Income Tax Department is critical. Since TDS is linked to the player's Permanent Account Number (PAN), all winnings are automatically reported to the tax authorities. In 2026, it is essential for players to ensure their PAN is verified on the gaming platform to avoid higher "penal" TDS rates, which can be significantly higher if a valid PAN is not provided.
Even if TDS has been deducted, players are required to disclose these winnings under the head "Income from Other Sources" when filing their Income Tax Returns (ITR). The TDS certificates (Form 16A) provided by the gaming platforms can be used to claim credit for the tax already paid, ensuring the player is not double-taxed on the same income. Many players also explore other Rummy games and digital card platforms, all of which follow these identical reporting standards.
Impact of Bonuses and Incentives
In 2026, the treatment of promotional bonuses, referral rewards, and cashback in Andar Bahar is also standardized. Any bonus that can be withdrawn as cash is considered part of "Net Winnings" and is subject to the 30% TDS. However, non-withdrawable bonuses used solely for gameplay are generally not taxed until they are converted into withdrawable winnings through successful bets.
Frequently Asked Questions
Is there a minimum threshold for TDS on Andar Bahar winnings in 2026?
No, there is no minimum threshold for online gaming. Under Section 194BA, TDS must be deducted on any amount of net winnings, even if the profit is as low as ?1. This differs from horse racing or offline lotteries which may still maintain a ?10,000 threshold.
Can I offset losses from Andar Bahar against my salary income?
No. According to Section 115BBJ, losses from online gaming cannot be set off against any other head of income, such as salary, house property, or business profits. Furthermore, gaming losses cannot be carried forward to future financial years.
What happens if I don't withdraw my winnings by March 31st?
If you have net winnings sitting in your gaming wallet on March 31st, the platform is legally required to deduct 30% TDS on that balance as of the end of the financial year, even if no withdrawal request was initiated by the player.
Does the 28% GST reduce my playable balance?
Yes, in most cases. Since the 28% GST is levied on the deposit amount, platforms may either deduct this from your deposit or absorb the cost as a promotional expense. However, the legal liability remains based on the total value of the stakes placed.