Often people have this question in their minds whether any amount of money can be deposited in the bank account at any time? Especially when someone has received a large amount in cash due to marriage, property deal, business payment or any emergency.
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But if you deposit more cash than a fixed limit in the bank, then the Income Tax Department can keep an eye on you. That is why it is important that you understand the cash deposit rules of the bank properly.
Limit for depositing cash in savings account
If you are depositing money in a savings account, then a report is sent to the Income Tax Department if you deposit more than ₹ 10 lakh in cash in the entire financial year (from April 1 to March 31). That is, if you deposit ₹ 10 lakh or more in cash in a savings account (Savings Accounts Cash Deposit Limit) in a year, then the bank will share this information with the tax department.
Separate limit for current account
This limit is higher in a current account i.e. business account. If ₹50 lakh or more cash is deposited in a year, then it also comes under the purview of income tax. In such a situation, if you are a businessman and often deposit large amounts in cash, then keep a complete record of the transaction and keep the proof safely.
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How much cash can I deposit at one time?
There is no fixed limit on the amount of cash deposited by the bank at one time. If you want, you can deposit up to Rs 2 lakh or Rs 5 lakh at once. But if your amount is big and your income or source is not clear, then the tax department can question you.
PAN is mandatory for depositing more than 2 lakh rupees
If you deposit Rs 2 lakh or more in cash in a bank at one time, then you are required to provide your PAN number. Without PAN, the bank does not accept cash of more than Rs 2 lakh.
In simple terms, it is mandatory to provide PAN while depositing more than Rs 2 lakh in cash. A report is sent to the Income Tax Department if you deposit more than Rs 10 lakh in a year in a savings account and Rs 50 lakh in a current account. To avoid this, keep a complete record of the transaction.
Know the rules or else you may have to pay a fine
If you deposit more cash than the prescribed limit and are unable to explain its source, the Income Tax Department can send you a notice. In such a case, you may also be fined and your problems may increase. Therefore, use digital payments as much as possible and if you make cash transactions, then keep a record of it. If you are also thinking of depositing a large amount in cash, then keep these rules in mind.
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