How much Cash can you keep at your home: Know it
In the swiftly advancing digital era, individuals have minimized the practice of holding cash within their residences. Yet, it's worth recalling that in your grandmother's era, counsel often favored stashing cash at home for unforeseen emergencies. Prior to that, there was a reluctance to entrust funds to banks, and individuals preferred safeguarding accumulated money in concealed locations within their homes. Presently, societal shifts have led to widespread reliance on digital wallets for transactions. However, amidst these transformations, do you possess knowledge regarding the permissible maximum amount of cash one can retain at home? If not, let us acquaint you with the regulations.
How much cash is permissible to retain at home and what penalties might be incurred for exceeding that limit are likely questions on your mind. However, it's important to be aware of the regulations governing the amount of cash one can keep at home. According to Income Tax rules, there is an allowance for keeping cash at home, but in the event of your cash being scrutinized by investigative agencies, you must be prepared to disclose your income or the source of that money.
Filing your Income Tax Return (ITR) annually provides a safeguard in such situations. It is advisable to ensure that the amount of cash at home aligns with the figures declared in your ITR. Consequently, it's essential to maintain accurate documentation to substantiate your sources of income if required. It's crucial that the cash holdings correspond with the income declared in your ITR; otherwise, disparities could arise, potentially leading to complications.
The challenges can escalate if you are unable to account for your cash holdings during an Income Tax raid. It is imperative to furnish accurate and detailed information regarding your income when confronted by the Income Tax Department. If you can provide precise details, you may avoid fines altogether. However, failing to provide adequate information could result in a tax penalty of up to 137% on the amount of cash discovered. In essence, you may be required to pay an additional 37% tax on top of the cash amount.