Winning Bizness Desk

Mumbai. The IPL 2024 mega auction, held in Jeddah, Saudi Arabia, saw 10 franchises spend a total of Rs 639.15 crores over two days. A total of 182 players were sold, including 62 foreign players. Indian wicketkeeper-batter Rishabh Pant became the most expensive player in IPL history, bought by the Lucknow Super Giants (LSG) for Rs 27 crores.

How Much Money Do Players Actually Get?

Indian Players: A 10% TDS is deducted from their earnings.

Foreign Players: A higher 20% TDS is deducted.

For instance, if an Indian player’s salary is Rs 10 crores, Rs 1 crore is deducted as tax before payment. For a foreign player with the same salary, Rs 2 crores are deducted. This tax is paid to the Indian government on behalf of the players.

Tax Rules for IPL Earnings

Indian Players

The money Indian players earn in IPL is treated as "income from other sources" under the Income Tax Act, 1961. This amount is added to their total income, and they pay tax based on their income tax slab. The TDS already deducted is adjusted when they file their tax returns.

Foreign Players

In India for Over 182 Days: Foreign players staying in India for more than 182 days in a financial year are taxed like Indian residents. Their IPL earnings are added to their total income and taxed based on slabs. In India for Less Than 182 Days: These players are only subject to TDS under Section 194E of the Income Tax Act, and their global income is not taxed in India.

Government Earnings from the Auction

Out of the Rs 639.15 crores spent in the auction, Rs 383.40 crores went to Indian players, resulting in Rs 38.34 crores in TDS (10%) and Rs 255.75 crores went to foreign players, generating Rs 51.15 crores in TDS (20%). In total, Rs 89.49 crores from the auction will be deposited into the Indian government’s treasury as taxes. This system ensures a significant portion of IPL earnings goes back into the country’s tax system while players take home slightly less than their auction amounts.