Savings Account Maximum Withdrawal/Deposit Limits: Nowadays, almost everyone has a savings account used for depositing money, making withdrawals, and conducting online transactions. Specific rules for cash transactions must be strictly followed. Additionally, if cash deposits exceed certain limits, the bank may be required to report the details to the Income Tax Department.
PAN Number Required for Cash Deposits
According to banking regulations, if an individual deposits ₹50,000 or more in cash into their account in a single transaction, providing a PAN number is mandatory. This rule helps monitor large transactions and ensures transparency.
How Much Cash Can Be Deposited in a Day?
Generally, regulations allow a cash deposit of up to ₹1 lakh per day. However, if an individual deposits cash representing regular income, this limit increases to ₹2.5 lakh. Furthermore, an individual can deposit up to ₹10 lakh in cash across one or more accounts within a single financial year. This limit applies to the aggregate of all accounts held by the taxpayer.
Is There a Limit on the Balance Maintained in a Savings Account?
There is no upper limit on the balance that can be maintained in a savings account according to bank rules; customers can keep any amount they require. However, if the deposited amount falls within the purview of income tax regulations, the individual must provide a valid source for the funds. Large sums—even lakhs or crores—can be deposited into a savings account by cheque.
What Happens if Cash Deposits Exceed ₹10 Lakh?
If an individual deposits more than ₹10 lakh in cash into their bank account during a financial year, the bank reports this transaction to the Income Tax Department. The individual may then be asked to disclose the source of the deposited funds. Failure to declare this income in the Income Tax Return could lead to scrutiny by tax authorities.
Heavy Tax for Failure to Disclose Source of Funds
If an individual deposits cash exceeding ₹10 lakh and fails to provide a valid source for the amount, a 60% tax, a 25% surcharge, and a 4% cess may be levied on that sum. The Income Tax Department may also conduct further investigations in such cases.
Rules Regarding Zero-Balance Accounts
Many banks in the country offer zero-balance savings account facilities. According to the Bank of Baroda’s official website, customers with zero-balance accounts are not required to maintain a minimum balance.