Although the RBI has not set a cap on how many 2000 rupee notes can be placed in bank accounts, tax experts advise that one be familiar with the specifics of financial transaction (SFT) guidelines. High-value cash deposits made through banks are reported to the Income Tax Department in accordance with SFT regulations. The 26AS and Annual Information Statement of the depositor both indicate this. In accounts other than current accounts, the reporting limit for cash deposits made through banks or postmasters general is Rs. 10 lakhs, and in one or more current accounts, it is Rs. 50 lakh.
Helpful document
People should make sure that the cash deposit slip is filled out with the correct bank information, including the account number, name, and other pertinent data. This slip is often accessible at the bank’s counter or through its Internet banking system. If you are depositing more than Rs. 50,000, you must submit your Permanent Account Number (PAN) in accordance with Income Tax rules. Keep your PAN card on you at all times for identification.
Notice of Income Tax
Numerous variables influence the likelihood of receiving an income tax notice while making a bank deposit. Large deposits even notes worth Rs 2,000, are accepted as long as the source of income can be proved. It would be more practical to deposit significant amounts of notes in a bank account as opposed to exchanging them. For the exchange of 2000 rupee notes at bank branches, there is a daily limit of just 10 notes, bringing the total to Rs 20,000.
In this case, notice won’t be issued on exchanging 2000 rupee notes.
The IT department combines information like a tax return with data from deposits in your bank account. The person might not get an income tax notice if the deposit matches his personal information. If an income tax notification is received, it is the taxpayer’s responsibility to establish the source of income and submit supporting documentation. The reporting of suspicious account transactions, such as a sudden fast increase in cash deposits, is required of banks; this may also be the case when exchanging 2000 rupee notes. If you receive an IT notice in this case e, it is important to seek assistance from a tax advisor or a chartered accountant.
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