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.

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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.

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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.

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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.

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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.

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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.

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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.