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CA Intermediate · Taxation · Income from Other Sources

Mr. Arvind Sharma, a resident individual, won ₹10,00,000 in a lottery in tax year 2026-27. He had bought lottery tickets worth ₹50,000 during the year, and he spent ₹20,000 on travel to collect the prize. He has no other income. What amount is chargeable as income from lottery winnings under the head Income from Other Sources?

The whole ₹10,00,000 is chargeable. Lottery winnings are taxed on the gross amount under Income from Other Sources, and the law allows no deduction for the cost of tickets or for travel expenses incurred to collect the prize.

  1. A₹9,50,000
  2. B₹9,30,000
  3. C₹10,00,000Correct
  4. D₹9,80,000

Explanation

Winnings from lotteries, crossword puzzles, races and similar games are taxed on the gross amount. No expenditure or allowance is deductible against them, so ticket cost and travel cost are both ignored. The chargeable amount is ₹10,00,000. The other options wrongly deduct the ticket cost, the travel cost, or both.

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