Savings Account: Nowadays everyone has a bank account. But most of the people open savings accounts because people deposit the money left after expenses in the savings account. But the Income Tax Department keeps a close watch on your earnings. If you are also going to deposit money in a savings account, then definitely know the rules of income tax.
New Delhi: This is a common question that most of the people raise. People want to know how many savings accounts they can operate simultaneously so that they do not face any problem with Income Tax.
The second question is that what is the maximum balance that can be kept in the savings account so that income tax notice is not received. It is very important for such customers to know how much of the balance in their account is taxed and how much is not.
Interest is earned on depositing money in savings account-
Actually, annual interest is given by the bank on the savings account, but all the banks have different interest rates. At the same time, some customers do not know how much money you can deposit or withdraw from your savings account in a financial year.
So that you do not come under the tax net? There are many such misconceptions in the minds of taxpayers regarding savings bank accounts, which need to be removed in time.
How much money can be kept in savings account?
In a normal savings account (Savings Account Cash Limit), you can deposit any amount of money and withdraw any amount of money. There is no limit for depositing or withdrawing money in this.
However, there are limits for depositing cash and withdrawing cash by visiting the bank branch. But, through check or online, you can deposit Rs 1 to thousand, lakh, crore, billion or any number of rupees in your savings account and maintain it as balance.
Tax department will have to answer
Bank companies have to answer the Tax Department every year if customers withdraw amounts of Rs 10 lakh or more from the bank.
Under the tax law, the bank has to give information about those accounts during the current financial year. This limit is viewed in aggregate for cash deposits of Rs 10 lakh or more in a financial year in one or more accounts (other than current accounts and time deposits) of the taxpayer.
You can deposit only this much cash
The limit of cash deposit in current account is Rs 50 thousand or more. Talking about transactions, Kapil Rana, Founder and Chairman of Hostbook Limited says.
That a person should be aware of Rule 114E of Income Tax regarding income and expenditure made from accounts. With this, he can withdraw or deposit only that much money from his savings account in a financial year so that it does not come under the income tax radar.
Tax has to be paid on interest
The bank account holder has to pay tax on the interest earned on the amount kept in the savings account of the bank. The bank deducts 10 percent TDS on interest. Balwant Jain says that tax has to be paid on interest.
But, tax deduction can be availed on this also. According to Section 80 TTA of the Income Tax Act, all persons can get tax exemption of up to Rs 10 thousand. If the interest earned is less than Rs 10 thousand then tax will not have to be paid.
Similarly, account holders above 60 years of age do not have to pay tax on interest up to Rs 50,000. If even after adding that interest to your total annual income, your annual income is not enough to become a tax liability, then you can get a refund of the TDS deducted by the bank by submitting Form 15G.
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