To control problems like tax evasion and black money, the government has made many rules regarding cash. You must know about these rules.
Cash Limit At Home: Digital transactions have increased rapidly since the Corona period. Now a large population prefers to do online transactions. But even after this, all kinds of transactions are still done through cash. At the same time, people who are not internet friendly also prefer to complete all their work through cash instead of online transactions.
Because of this, people still keep a lot of cash at home. But to control problems like tax evasion and black money, the government has made many rules regarding cash. In such a situation, there is a question that comes to mind many times, but we do not discuss it and that is how much cash can you keep at home? Know about it here-
What is the rule for keeping cash
According to the Income Tax rules, no specific rule or limit has been made in the matter of keeping cash at home. If you are financially capable, you can keep any amount of cash at home. But you should have the source of that money. If you are ever questioned by the investigating agency, you will have to show the source. Also, you will have to show the ITR declaration. This means that if you have not earned money illegally, then no matter how much cash you keep at home, you do not need to worry.
Action can be taken in these situations
If you are unable to tell the investigating agency the source of the money, then it can be a big problem for you. In such a situation, the investigating agency is informed about this. Then the Income Tax Department investigates how much tax you have paid. Meanwhile, if undisclosed cash is found in the calculation, then action can be taken against you by the Income Tax Department. In such a situation, up to 137% of the undisclosed amount of tax can be recovered from you.
What are the other rules in the case of cash
– According to the Central Board of Direct Taxes, if you withdraw more than Rs 50,000 in cash at a time, then you will have to show your PAN card. Under Section 194N of the Income Tax Act, if a person withdraws more than Rs 20 lakh in a financial year, then he will have to pay TDS. However, this rule is only for those who have not filed Income Tax Return (ITR) for 3 consecutive years.
– People who have filed ITR get some relief in this matter. Such people can withdraw up to 1 crore rupees in cash in a financial year from a bank, post office or co-operative bank account without paying TDS. In this situation, 2% TDS will have to be paid on withdrawing more than 1 crore cash from the bank in a year. If you have not filed ITR for the last three years, then 2% TDS will have to be paid on transactions of 20 lakh rupees and 5% TDS on transactions of more than 1 crore rupees.
– There can be an investigation if you make a transaction of more than 1 lakh rupees at a time using a credit-debit card. Apart from this, you cannot pay more than 2 lakh in cash to buy anything. If you want to do so, then you will have to show PAN and Aadhaar here also.
