India has strict regulations on high-value cash transactions to curb black money, with penalties of up to 100% on prohibited transactions. Key rules include a ₹2 lakh limit on cash receipts from one person per day, a ₹20,000 cap on cash loans/repayments, and mandatory reporting for cash withdrawals exceeding ₹10–20 lakh annually.
Certain common cash transactions now attract strict penalties: Receiving ₹2 lakh or more in cash from one person in a day can lead to a penalty equal to the amount received. Accepting or giving cash loans above ₹20,000 violates the rules and may trigger a 100% penalty.
Introduced in House (02/07/2025) This bill requires retail businesses to accept cash as a form of payment for on-site sales of $500 or less and it prohibits them from charging cash-paying customers a higher price compared to customers not paying with cash.
According to section 194N of the Act, TDS has to be deducted if a sum or aggregate of sum withdrawn in cash by a person in a particular FY exceeds : ₹ 20 lakh (if no ITR has been filed for all the three previous AYs), or. ₹ 1 crore (if ITRs have been filed for all or any one of three previous AYs).
There is no law restricting the amount of cash you can store in your house. However, if you are found to have a large amount of cash without a clear, legitimate source, it could be treated as undisclosed income. This could lead to serious consequences, including penalties, fines, and even legal action.
For Domestic: if you carry more than Rs 50,000, you may be asked to declare the source of the funds. The I-T department may investigate if you carry more than Rs 2 lakh in cash. For international: You can carry up to Rs 25,000 in Indian currency .
Yes, you can deposit $50,000 cash in a bank, as there's no legal limit on cash deposits, but the bank must report it to the IRS by filing a Currency Transaction Report (CTR) because it's over the $10,000 threshold; expect potential scrutiny and be prepared to provide documentation about the source of funds, and never try to avoid reporting by "structuring" smaller deposits, which is illegal.
The fact that your bank will report any cash deposits or withdrawals in excess of $10,000 isn't necessarily cause for alarm. The intent is to identify and monitor where the money ends up, Castaneda says. "It should not be construed as illegal activity," he says.
According to the 2021 amendment, if you haven't filed your ITR for the last three assessment years, the TDS threshold reduces from Rs. 1 crore to Rs. 20 lakh, and a 2% TDS is applicable on cash withdrawals beyond this lower limit.
9 tips to protect yourself while at the ATM
Depositing $2,000 in cash isn't inherently suspicious and is well below the $10,000 reporting threshold for banks, but it can raise flags if it's part of a pattern (structuring), inconsistent with your normal income, or involves other red flags like frequent large cash deposits from others, leading to a potential Suspicious Activity Report (SAR). To avoid issues, have clear records for the cash's source, like invoices or sales receipts, especially if you deal in cash often.
Cash use has been declining for years, but cash isn't close to going away. In 2022, there were a staggering 70 billion cash transactions, making it the third-most-common payment method.
Two key measures in Bill C-2 that will impact charities and non-profits. Bill C-2 proposes two major anti-money laundering measures that will affect charities and non-profits: a broad prohibition on cash transactions of over $10,000; and. restrictions on third-party cash deposits accepted by banks.
Maximum marginal rate is the highest rate of tax at any income level. This means for those with incomes between Rs 2 crore and Rs 5 crore, 39% will be the highest applicable tax rate, and for those with incomes above Rs 5 crore, it will be 42.74% — the highest tax rate since 1992.
The RBI has set a cap of ₹2 lakh for cash deposits made in a day, per transaction, and from a single person under section 269ST. The most significant number you must remember is the annual limit. In a financial year, the cash deposit limit in a savings account is capped at ₹10 lakh.
Implications of Section 269ST
For real estate buyers and sellers, this means property transactions must flow through banking systems. Cash payments for property purchases are effectively prohibited since they typically exceed Rs. 2 lakh.
Section 194N of the Act mandates that tax will be deducted if cash withdrawals in a given financial year exceeds ₹ 20 lakh (in the event that no ITR has been filed for all three previous AYs) or ₹ 1 crore (in the event that ITRs have been filed for all or any one of the three previous AYs).
With the recent changes in the Indian Income Tax Act, it's now possible to pay zero tax on a salary of up to Rs. 7 lakhs. To pay zero tax on a 7 lakh salary using the old tax regime, maximize deductions: Claim Tax Rebate under Section 87A.
You can deposit any amount of cash without being automatically flagged if it's under $10,000 in a single transaction, but banks must report deposits of $10,000 or more to the IRS via a Currency Transaction Report (CTR). While large, legitimate deposits are fine, making multiple deposits to stay under $10,000 (structuring) is illegal and triggers Suspicious Activity Reports (SARs), leading to potential account freezes or law enforcement scrutiny, so transparency with your bank is best for large sums.
ATM cap: ₦100,000 per day and ₦500,000 per week. Third-party cheques above ₦100,000 can no longer be cashed over the counter (though they can still be deposited into your account) Banks must report all large withdrawals to CBN monthly. Fee revenue split: Banks keep 60% of excess withdrawal fees, while CBN takes 40%.
A paper trail of potentially suspicious deposits is created after Form 8300 is transmitted to the IRS. Depositing cash at an ATM or with a bank teller, so long as it is below the $10K threshold, will usually not be reported.
The cash deposit limit in savings accounts as per income tax is ₹10 Lakh during a financial year. All banks or financial institutions must declare large cash deposits according to Section 114B of the Income Tax Act, 1962.
That said, cash withdrawals are subject to the same reporting limits as all transactions. If you withdraw $10,000 or more, your bank must report it to the IRS by law. This helps prevent money laundering and tax evasion. Still, few banks set withdrawal limits on a savings account.