Income Tax Alert: The Income Tax Department has become very cautious about cash transactions these days. In the last few years, the Income Tax Department has tightened the rules for cash transactions for the general public on various investment platforms like banks, mutual fund houses, broker platforms, etc.
Let us tell you that there are many such transactions, which are kept under the watch of Income Tax. If you do large cash transactions with banks, mutual funds, brokerage houses, and property registrars, then they have to inform the Income Tax Department.
Income Tax Alert: Let us know about 5 such transactions, which can put you in trouble.
1. Bank Fixed Deposit (FD):
If you deposit Rs 10 lakh or more in FD in a single year or more than once, the Income Tax Department may ask you about the source of the money. In such a situation, if possible, deposit most of the money in FD through an online medium or through a cheque.
2. Bank savings account deposits:
If a person deposits an amount of Rs 10 lakh or more in cash in one account or more than one account in a financial year, then the income tax department can question the source of the money. The maximum limit in current accounts is Rs 50 lakh.
3. Payment of credit card bill
Many times people also deposit the credit card bill in cash. If you deposit more than Rs 1 lakh as a cash credit card bill at a time, then the income tax department can question you. On the other hand, even if you pay a credit card bill of more than Rs 10 lakh in cash in a financial year, you may still be asked about the source of the money.
4. Property Transactions
With the property registrar, if you do big transactions in cash, then its report also goes to the Income Tax Department. If you buy or sell any property worth 30 lakhs or more in cash, then the information about it will go to the Income Tax Department on behalf of the Registrar of Property.
5. Purchase of Shares, Mutual Funds, Debentures, and Bonds
If you do a large Amount of cash transactions in Shares, Mutual Funds, Debentures, and Bonds then you may face problems. Cash transactions up to a maximum of Rs 10 lakh can be done in such instruments in a financial year. So if you have any plans to invest money in any of these, then the first thing to keep in mind is that you do not have to use large amounts of cash.