Cash deposit limit in saving account As Per Income Tax 2023 | guide step by step

Cash deposit limit in saving account

How to maintain a savings account so that you do not get income tax notices. If you deposit cash more than a limit in your savings account in a financial year, then you may also receive an income tax notice and you will have to give justification from where this income came to you.

Let’s see once, what will we discuss here?

How to maintain a savings account

Point 1 is how many savings accounts you can maintain so that you do not get any notice from income tax. How much cash you can deposit in your savings account or how much cash you can withdraw. How much money can be deposited in the savings account or how much money you can withdraw, so that you do not get any notice.

Point 2, we will talk about if you deposit cash more than the limit, then in how many years you can get the notice, within how many time period you can get the notice.

Point 3, If you get any notice related to savings bank account from income tax side, then how to give justification of it. cash deposit limit in saving account

First of all, let’s talk about how much money can be kept in the savings account, according to the Income Tax Act, there is no such limit, you can maintain as many amounts as you think are right.

If you feel that your work is going on with one account, then you can also maintain an account. If you think there should be two or three then you can maintain as many.

There is no such rule in the Income Tax Act that you have to keep the same number of accounts or not less than that. No such limit has been stated, but one thing is to be kept in mind.

The more bank accounts you keep, the higher will be the bank charges because each bank has its own fixed charges. If you have got an ATM card issued in every account, then there is an annual charge for it.

Banks also deduct a considerable amount in the name of SMS charges. If you have to maintain minimum balance in many banks, then you will have to maintain every bank account. cash deposit limit in saving account

Along with that, if your minimum balance is missed in someone, then you may also have to pay charges. You should have 2 to 3 savings accounts, if you do any more transactions then you can have three accounts.

Otherwise you should have two savings accounts because sometimes one savings account does not work at the time of emergency, then you should also keep an alternate for that.

How much cash you can deposit in your savings account

Now let’s talk about how much cash you can deposit in your savings account or how much money you can withdraw. Within a year, its limit is ₹ 10 lakh.

You can deposit up to ₹ 10 lakh in a year in all your savings bank account and you can withdraw only ₹ 10 lakh, if you deposit more than 10 lakh cash amount in your bank, then you will have income tax Notice. cash deposit limit in saving account

Now how will this limit be calculated, suppose you have two savings bank accounts. In one you deposit ₹ 8 lakh and in the other you deposit ₹ 4 lakh, so the total that you deposited cash within a year has become ₹ 12 lakh,so you can get a notice from the Income Tax Department.

What you have to do is that you do not have to deposit cash more than the amount you have to keep the limit of TEN LAKH, all of your savings bank accounts. If you deposit more cash than that, you may get a notice.

It is a matter of your aggregate amount that you can deposit or withdraw up to ₹ 10 lakh in a year. But there is a limit of ₹ 2 lakh in a single transaction, no more than ₹ 2 lakh is to be deposited or withdrawn at a time.

If you deposit more than ₹ 2 lakh in cash in a single transaction, then you can get a notice from Income Tax. cash deposit limit in saving account

If your income is in the right way. You have earned income in the right way. If you have its source, then you can tell it to the Income Tax Department,

if you are not able to tell its correct source, then you will have to pay tax on that income and also have to pay penalty, then above 2 lakh you have to avoid single transaction and Total You do not have to deposit more than ₹ 10 lakh in a year.

If you want to avoid income tax notice and if you have right proof of that income then you can get it done without any problem.

How much maximum savings account can be maintained

Now let us tell you how much maximum savings account can be maintained, for this there is no such restriction in the Income Tax Act that you can keep only this balance.

You can deposit as much as you want with the balance you have and keep as much as you want to keep the balance. There is no such limit mentioned in the Income Tax Act,

but if you are depositing the balance, whatever balance you are maintaining, you should have its source. cash deposit limit in saving account

Suppose if you earn ₹ 2 lakh in a year and deposit it in it, then you do not have any problem. In this way, you can deposit two ₹ 2 lakhs for 10 years. You will get ₹ 20 lakhs.

If you want to continue even further, you can But if you deposit ₹ 5 lakh in a year. Next year you deposit 5 lakhs again, then you deposit 5 lakhs again.

If you keep depositing like this, then you may get notice from Income Tax side because the income you are earning ₹ 5 lakh is above the taxable limit.

That is, if you earn more than 2.5 lakh rupees, then you have to file ITR, then you are depositing ₹ 5 lakh, then it means that you must be earning 5 lakh.

If you have filed ITR for ₹ 5 lakh then you have no problem. But you have not filed ITR and you are depositing the balance in the bank account by doing 5,6,7 lakhs like this, then notice may come.

You can deposit as much cash as you file ITR. If you have filed ITR of ₹ 25 lakh in this year, then you can add ₹ 25 lakh to your bank account. That is, there can be an increment of 25 lakhs in the balance which is already there.

Now you have ₹ 27 lakhs in your bank account, if you earn 25 lakhs more next year, then you can complete ₹ 25 lakhs. You will not get any notice in that savings bank account, but you should have an idea, that amount moves up and down a bit more than what you have deposited, cash deposit limit in saving account

But if you deposited ₹ 10 lakh directly and you do not have any ITR, If so you may get a notice. So you can deposit as much cash as you file ITR. If you do not file ITR, then you can deposit an average of 2 to 3 lakh rupees in your bank account,

So now let’s talk about the limit of ₹ 2 lakh and that of total of ₹ 10 lakh, then that limit if you If you cross, then you will get the notice of that too, when can it come to you, this is not the notice that you have submitted today and you will get the notice after five days or you will get the notice within a couple of years.

You can get a notice at any time. As soon as you come to the notice of the Income Tax Department, they can send you a notice. So in the next six years you can get the notice any time.

That is, say that three years ago, you had deposited ₹ 10 lakh in your savings bank account, then its notice can still come and notice can come in the coming three years also. The notice of previous transaction can come anytime in the next six years.

Last Topic If you have managed your savings bank account in the right way, but still you get a notice, then what should you do.

if you have deposited any money by breaching the limit then you must have got a notice. cash deposit limit in saving account

Now why did you breach that limit, you will have to tell its simple genuine reason to the Income Tax Department,

Suppose you have deposited ₹ 4 lakh cash in your bank account at once and you have received notice of it.

Now you have to give every region of it. From where did you get this ₹ 4 lakh, if you give its reason, then you will be made free.

If you are not able to give the reason for it properly. So you will have to pay penalty on that amount and you will also have to pay penalty as much as that amount.

That is, if your transaction is only ₹ 4 lakh, then you will be taxed on it, after that penalty will be levied, late fee will be applicable. By doing this all the amount you have will be recovered. cash deposit limit in saving account

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