Cash limit at home: Many people who transact in cash also keep cash at home. There is also a rule for keeping cash at home (cash deposit rules at home), but most people do not pay attention to this and get caught in the clutches of the income tax department.

If you also transact in cash and keep cash at home, then you must know these rules, otherwise, you will have to pay 137 percent tax (tax on home cash). Apart from this, you may have to face many other problems.

The source of money should be known -

There is no restriction on keeping cash at home, but the source of this cash should be known. Do show this in the ITR (income tax return) as well, otherwise, you will have to be ready to pay 137 percent tax (Tax on receiving cash at home) on the cash found at home.

If you do not have a known source of this money, then the Income Tax Department can raid your house. The department can ask where you got this money from, then you will have to give a satisfactory answer. If you are unable to give the right answer, then the department will take action.

This is how you can avoid action-

If the cash found at home comes under the purview of tax (tax rules on cash), then you can be asked whether you have paid tax on it or not. If you have solid evidence of the source of this money and have also paid tax (income tax), then you will be saved from action. Otherwise, you will have to pay 137 percent tax on the money found at home. If the Income Tax Department is not satisfied with the answer or the documents related to the source of money are not there or are fake, then action is sure to be taken against you.

Also, know this rule related to cash-

The rule for depositing money in the bank (cash deposit rules) has also been fixed. PAN card and Aadhaar card have to be shown on depositing more than Rs 20 lakh cash in the bank in a financial year. If you withdraw more than Rs 1 crore in cash from your bank account (bank account news) in a financial year, then you will have to pay 2 percent TDS (TDS on cash withdrawal) on it.

If you withdraw Rs 50 thousand or more in cash from the bank in a day, then you need to show your PAN card, otherwise you may be fined (fine on cash found at home).

Rule of cash transactions in a day-

Even in the case of property purchase (property buying rules), if you transact more than Rs 30 lakh in cash, then you can come under the radar of the department (income tax department). Any purchase above Rs 2 lakh in a day cannot be made in cash. Aadhaar and PAN card are necessary for this. Apart from this, action can also be taken against you for a transaction of more than Rs 1 lakh in a day through a debit card (debit card rules).

This is the criterion for the donation amount-

If you have to take more than 2 lakh rupees from someone in a day, then it would be better to do this through the bank (bank news). Donations of more than 2,000 rupees in a day cannot be done in cash (cash donation rules). For this, you can use a cheque or it would be better to do this through the banking system.

Disclaimer: This content has been sourced and edited from Hr Breaking. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.