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Income Tax Notice: You will find many people who prefer to transact in cash even in the era of Digital India. Small transactions are fine, but the problem arises when big cash transactions start happening. As soon as the slightest inkling comes, the Income Tax Department becomes alert and such people come on the radar of the Income Tax Department. Let us know about 5 such high value cash transactions, on doing which you can get income tax notice.
1- Depositing cash in bank account
According to the rules of the Central Board of Direct Taxes (CBDT), if a person deposits Rs 10 lakh or more in cash in a financial year, then this information is given to the Income Tax Department. It is possible that this money may have been deposited in one or more accounts. Now since you are depositing more money than the prescribed limit, the Income Tax Department may ask you about the source of this money.
2- Depositing cash in fixed deposit
Just as questions arise if depositing more than Rs 10 lakh in a bank account in a financial year, the same happens with FD. If you deposit more than Rs 10 lakh in one or more FDs in a financial year, if there is any doubt, the Income Tax Department may question you about the source of the money.
3- Large property transactions
If you have made a cash transaction of Rs 30 lakh or more while purchasing a property, then the property registrar will definitely inform the Income Tax Department about this. In such a situation, due to such a big transaction, the Income Tax Department may ask you from where you got the money.
4- Payment of credit card bill
If your credit card bill is Rs 1 lakh or more and you pay it in cash, you may still be asked about the source of the money. At the same time, if you pay Rs 10 lakh or more through any means in any financial year, the Income Tax Department can ask you from where you got the money.
5- Buying shares, mutual funds, debentures or bonds
It also alerts the Income Tax Department if large amounts of cash are used to buy shares, mutual funds, debentures or bonds. If a person makes a transaction of Rs 10 lakh or more, then its information reaches the Income Tax Department. In such a situation, the Income Tax Department may ask you from where you have brought the cash.
