Cash Deposit Limit for a Savings Bank Account as Per Income Tax Act

 

Cash deposit limit for a Savings account as per Income Tax: The cash deposit limit in savings accounts refers to the maximum amount of cash that an individual can deposit within a specified period without attracting the attention of tax authorities. This limit is set by income tax regulations to monitor and regulate the flow of cash transactions, curbing the potential for money laundering, tax evasion, and other illicit financial activities.

As per the provisions outlined in the Indian Income Tax Act, there are specific regulations concerning cash transactions, including significant cash deposits. Individuals who deposit cash into a savings account and accumulate INR 10 lakh or more during a fiscal year are required to notify the tax authorities. For those holding current accounts, this reporting threshold is elevated to INR 50 lakh.

It’s essential to recognize that although these deposits aren’t subject to immediate taxation, financial institutions are obligated to report transactions that exceed these limits to the Income Tax Department.


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