Savings Account We all use savings accounts. We use savings accounts to pay loan EMIs, make payments through UPI, withdraw money from debit cards, etc. Therefore, generally everyone keeps at least one savings account to fulfill banking needs. Do you know how much maximum money you can deposit in a savings account? If you deposit more than that, you will come under the radar of the Income Tax Department.
Alarm bells if the deposit is more than 10 lakhs
The Reserve Bank of India (RBI) has instructed banks to report cash deposits and withdrawals of Rs 10 lakh or more in a bank account to the Income Tax Department. As per the rules, 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 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. In addition, every person making a transaction must mandatorily quote his PAN or Aadhaar in documents related to such transactions. According to 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 in cash an amount of Rs 2 lakh and above in a day.
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