Income Tax News: The majority of people in the nation own a bank account. These bank accounts are used by most people for their financial transactions. The majority of these individuals are aware of the account’s minimal balance.
Overview of Bank Account Regulations
Apart from this, though, there are a plethora of other bank account regulations that you ought to be aware of. Numerous factors exist, such as the account’s maximum cash deposit limit, fees for ATM-debit cards, fees for checks, etc. Regarding each of these topics, the Reserve Bank of India (RBI) has released comprehensive guidelines.
We want to make it clear that there is always a minimum amount that needs to be kept in your account before discussing the maximum amount that can be stored there. The bank subtracts a penalty charge because there is no minimum amount. Banks vary in what their minimum balance requirements are. The minimum balance limit varies from Rs 1,000 to Rs 10,000 depending on the situation.
Cash Deposit Limits in Savings Accounts
The amount of cash that can be deposited into these savings accounts is likewise limited. A person may deposit up to Rs 10 lakh in cash into his savings account throughout a financial year, per income tax regulations. Banks are required to notify the Income Tax Department of any deposits of cash exceeding this amount.
Additionally, you will need to supply your PAN number if you deposit money into your account that is equal to or more than Rs 50,000. Up to Rs 1 lakh can be deposited in a single day. Additionally, this cap may increase to Rs 2.50 lakh if you do not consistently deposit funds into your account.
Scrutiny and Penalties for Exceeding Cash Deposit Limits
Scruitiny may occur if you deposit more money than the Rs. 10 lakh maximum in your account and fail to disclose its source satisfactorily on your income tax return. You will face severe fines if you are discovered during this investigation. You may be subject to a 60 percent tax, 25 percent surcharge, and 4 percent cess on the deposit amount if you fail to disclose the source of your income.
Finally, let’s get to the subject. To be honest, we all save money in savings accounts to protect our earnings. Its upper limit is not set in such a case. However, it is a certain that the Income Tax Department may investigate the account if you hold onto additional money in it and fail to reveal the source of the funds. You have nothing to fear if the source of the inflow is obvious.
Transitioning to Fixed Deposits
Second, you ought to move any large amounts of money you have retained in your savings account into a fixed deposit. Your investment will yield a just reward for doing this. When you deposit money into a savings account, you receive relatively little in return. Banks provide deposit plans that range in duration from a minimum of seven days to several decades. You’ll get good returns on your investment by doing this.