Cash withdrawal from a bank
Do you know? If you withdraw your own money in cash from your own bank account, then TDS is deducted from the bank.
If you do not know and want to know, then first of all know about the section 194N of the Income Tax Act, under which it is written that if you withdraw money from your own bank account more than a certain limit, then the bank will withdraw from your account & TDS will be deducted.
The reason why this was done is because the government had introduced this section to reduce the number of transactions in cash and to promote online payments.
Now let’s understand what is section 194N, basically this section is of TDS, in which banks have been informed, if any customer withdraws cash from his bank account in excess of a certain limit, then tax is to be deducted on it.
That is, TDS has to be deducted from that amount and that TDS amount has to be deposited to the government on the basis of that customer if he has given his PAN card. cash withdrawal from a bank
If you have not given PAN card and you do cash withdrawal more than that certain limit, then you should stop it from now because you will never get back the tax you will deduct and that tax amount is very high.
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So first of all you have to deposite PAN card in your bank account.
Now let’s talk about the limit after crossing which TDS will be deducted from your bank account, then it is divided into two categories.
In the first category, those people who have filed their income tax return in the last three years and in the second category those who have not filed their income tax return in the last three years.
Let us first talk about those who have not filed Income Tax Return.
First Category cash withdrawal:
The limit which is ₹ 20 lakhs, that is, in a year, the total amount of ₹ 20 lakhs they can withdraw their cash inside a bank.Whatever amount they withdraw above that, their TDS will be deducted. cash withdrawal from a bank
And the TDS which will be deducted at the rate of 2%, suppose you have withdrawn ₹ 21 lakh from the bank in the whole year, then TDS of 2% will be deducted on the amount of ₹ 1 lakh and your tax of ₹ 2,000 will be deducted and This rate of 2 percent is valid up to 1 crore.
if you withdraw cash throughout the year from your bank account, then your TDS of two percent will be deducted there.
And if you withdraw cash more than 1 crore, then your TDS of 5% will be deducted on it, if you have not filed your income tax return in the last three years.
Second category cash withdrawal :
And now let’s talk. For those who have filed their income tax returns in the last three years, then the limit up to 1 crore is free for them.
No matter how much cash they can withdraw up to 1 crore, TDS will not be deducted on it. cash withdrawal from a bank
But whatever extra amount they withdraw from 1 crore, TDS of flat 2% will be deducted on it.
If you withdraw ₹ 1 crore 2 lakh from your bank account throughout the year, then tax of 2% will be deducted on top of ₹ 2 lakh i.e. TDS of ₹ 4,000 will be deducted.
Now let’s talk, this limit depends on which bank, that means, all the accounts you have inside one particular bank, then it will be considered as one.
If you have an account in a different bank then different limit will be considered.
Let’s take an example: That is, one bank will have a limit of 1 crore & the second bank also have a limit of 1 crore, and the third bank also same limit, so if you have an account in three different banks, then you can withdraw 1,1,1 crore money from each bank.
And on the other hand, if you have not filed ITR, then you can withdraw cash by doing 20, 20 lakhs from all your bank accounts.
Your TDS will be deducted on the amount above that and even if you have submitted a lower TDS certificate, it will not be applicable. If you breach this limit of 20 lakhs and 1 crore, then your TDS will be deducted. cash withdrawal from a bank
According to this section, you will not get any benefit of lower TDS
what is TDS on cash withdrawal from bank
Cash Withdrawals More Than ₹ 20 Lakh 2% TDS and 5% for withdrawals exceeding ₹ 1 crore
How to withdraw cash from the bank by cheque
Step 1: Go to any branch of your bank.
Step 2: the bank will verify the details on the cheque and clear it.
Step 3: Now you will get the cash.
How many cash withdrawals from the bank in one day
Can I withdraw a large amount of cash from bank?
Yes you can withdraw as much as you want from a bank
How do I withdraw large amounts of cash?
just fill withdrawal slip and you can withdraw money in the present of the cashier