How much money do the winners of TV quizzes really earn after taxes: the calculations to be made

On television, every time a contestant takes a quiz, the potential money win is expressed as gold tokens. But what does it mean? And, above all, How much money do the winners actually take home? Suppose, for example, that a bet ends with a win of 150,000 euros, as happened yesterday December 21st at “Who wants to be a millionaire”: how much reaches the participant’s pockets?

It should first of all be specified that the money won on television quizzes, just like for the “Scratch cards” and the Italian Lottery, are considered gross rewardsto which parameters must therefore be applied taxes.

Specifically, with regards to prize quizzes broadcast on TV, the legislation provides for 3 costs to be applied to the overall winnings:

1. A withholding tax of 20%, as a substitute tax: in other words, it means that the Italian State takes 20% of the sum won. In reality, to make the procedure simpler, it is the television network itself that retains this percentage, delivering the amount already deducted from this tax directly to the competitor.
2. VAT at 22%: Italian law, in fact, prohibits TV programs from rewarding competitors with cash prizes, since they would be considered equal to gambling. It is precisely for this reason that the winnings are in gold tokens, on which however 22% VAT is applied for the purchase of gold. Also in this case, to reduce time, the sum of money is delivered to the competitor with the tax already applied.
3. Gold conversion costs: the gold conversion costs are finally applied to the sum won. In this case, these are not fixed rates, as they change based on the gold price on international markets, strongly influenced by global economic factors and geopolitical instability. Gold, not surprisingly, is considered a safe haven asset and its value increases as global uncertainty increases.

Let’s go back, then, to our initial example: a competitor takes part in a TV quiz and wins well 150,000 euros in gold tokens. From these, he will have to deduct 20% for withholding tax, 22% VAT for the purchase of gold and gold conversion costs.

In practice, the win will first and foremost drop from €150,000 to €120,000 (-20%), then a 93,600 € (-22%), to then reach the final sum of approximately €88,000 (assuming a gold conversion rate of 6%), with a total withholding of approximately €62,000.