Cash deposits of more than Rs 10 lakh in a person’s savings account during the financial year (April 1 to March 31) are reported to the Income Tax Department.
Cash deposits Limit: We all use Savings Account. From savings account, we pay loan EMI, make payment through UPI, withdraw money from debit card etc. Therefore, generally everyone keeps at least one savings account to meet banking needs. Do you know how much money you can deposit in a savings account? If you deposit more than that, then you will come under the radar of the Income Tax Department.
If you deposit more than 10 lakhs, then it is a warning bell
The Reserve Bank of India (RBI) has instructed the banks that if there is a cash deposit and withdrawal of Rs 10 lakh or more in a bank account, then they should inform the Income Tax Department about it. According to the rule, depositing an amount of more than Rs 10 lakh in a financial year attracts the attention of the Income Tax Department (ITD). Therefore, try not to deposit or withdraw more than Rs 10 lakh in a savings account once in a financial year. By doing this, you will come under the radar of the Income Tax Department. The Income Tax Department may ask you questions, which you will have to answer.
Banks give information to Income Tax Department
Cash deposits of more than Rs 10 lakh in a person’s savings account during the financial year (April 1 to March 31) are reported to the Income Tax Department. Banks are required by the Central Board of Direct Taxes (CBDT) to report such transactions, even if the deposits are distributed across multiple accounts. Apart from this, every person making a transaction must mandatorily quote his PAN or Aadhaar in documents related to such transactions. As per Income Tax rules, PAN number is mandatory for cash deposits of more than Rs 50,000.
As far as cash transactions are concerned, Section 269ST prohibits any person from receiving an amount of Rs 2 lakh and above in cash in a day.
