Know the Rs 2 Lakh Cash Limit Rule Before Your Next Big Transaction

Exceeding this cash transaction limit in a single day is illegal. According to Section 269ST, the Income Tax Department can impose a penalty equal to the full amount if this rule is violated.

Daily Cash Limit

The Indian Income Tax Department closely monitors cash transactions. If you transact over Rs. 2 lakh in a day, you could face a hefty penalty under Section 269ST of the Income Tax Act.

Income Tax Department

In today's era of increasing digital payments, the government and the Income Tax Department are closely monitoring cash transactions to prevent black money and tax evasion.

Cash Transactions

Receiving large amounts of cash can be risky. It's crucial to know the limit. Receiving over Rs. 2 lakh from one person in a day is illegal, whether it's a gift, loan, or payment.

Penalty

For example, if you receive Rs. 3 lakh in cash, the Income Tax Department can impose a penalty. All your transactions, including bank accounts, payments, loans, and gifts, are monitored.

Important Transactions

Key transactions monitored include bank deposits over Rs. 10 lakh/year, credit card payments over Rs. 1 lakh, property deals over Rs. 30 lakh, and gifts over Rs. 50,000.

Income Tax Notice

To avoid issues, use online methods for large transactions, keep receipts, and document gifts or loans. Using digital payments keeps you safe from penalties and tax notices.