Saving Bank Cash Deposit Limit from 1st April 2025

By | March 16, 2025
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Saving Bank Cash Deposit Limit from 1st April 2025

Financial Year: The financial year runs from April 1 to March 31.. Following limits are required to be kept in mind for Cash Deposit in Saving Bank Account

  • Cash Deposits in Saving Bank Account:
    • Daily Limit: If you deposit more than ₹50,000 in a day, you must provide your PAN

      Daily Deposit Exceeding ₹50,000 (Banking Company):

      • Scenario:
        • Mr. Singh goes to his SBI branch and deposits ₹70,000 in cash into his savings account in a single transaction.
      • Outcome:
        • Mr. Singh is required to quote his PAN for this transaction, as the cash deposit exceeds ₹50,000 in a single day. The bank will record his PAN and report the transaction as required.

      2. Multiple Deposits Exceeding ₹50,000 in a Day (Banking Company):

      • Scenario:
        • Mrs. Khan makes two separate cash deposits at her HDFC Bank branch on the same day:
          • Deposit 1: ₹30,000
          • Deposit 2: ₹40,000
        • Although neither deposit is over 50,000 individually, their sum is 70,000
      • Outcome:
        • Mrs. Khan is required to quote her PAN, as the aggregate cash deposits within the single day exceed ₹50,000.
    • Single Transaction Limit : Receiving cash of ₹2 lakh or more in a single transaction can attract a 100% penalty
       No person shall receive an amount of two lakh rupees or more—
      (a)in aggregate from a person in a day; or
      (b)in respect of a single transaction; or
      (c)in respect of transactions relating to one event or occasion from a person,
      otherwise than by an account payee cheque or an account payee bank draft or use of electronic clearing system through a bank account or through such other electronic mode as may be prescribed

(a) Aggregate Receipts in a Day:

        • Scenario:
          • Mr. Kumar, a retailer, sells goods to Mr. Verma.
          • Mr. Verma pays ₹1.2 lakh in cash in the morning and then another ₹1 lakh in cash in the evening of the same day.
        • Outcome:
          • Mr. Kumar has received a total of ₹2.2 lakh in cash from Mr. Verma in a single day.
          • This violates Section 269ST, as the aggregate cash received from one person in a day exceeds ₹2 lakh.

(b) Single Transaction:

        • Scenario:
          • Mrs. Sharma sells a used car to Mr. Gupta for ₹2.5 lakh.
          • Mr. Gupta pays the entire amount in cash.
        • Outcome:
          • This violates Section 269ST, as a single cash transaction exceeds ₹2 lakh.

(c) Transactions Relating to One Event or Occasion:

          • Scenario:
            • A wedding planner, Mr. Singh, is hired for a wedding event.
            • The client, Mr. Patel, pays:
              • ₹1.5 lakh in cash for decorations.
              • ₹80,000 in cash for catering.
            • Both payments are made in cash and relate to the same wedding event.
          • Outcome:
            • This violates Section 269ST, as the aggregate cash received for a single event (the wedding) exceeds ₹2 lakh.
    • Annual Limit: If you deposit ₹20 lakh or more in a financial year (April to March), you must provide your PAN and Aadhaar card .

Examples:  Cash Deposits Aggregating to ₹20 Lakh or More in a Financial Year:

    • Example 
      • Mr. Sharma has a savings account in SBI and another in HDFC Bank.
      • During the financial year, he deposits ₹12 lakh in cash in his SBI account and ₹9 lakh in cash in his HDFC account.
      • Outcome:
        • Neither SBI nor HDFC Bank will report Mr. Sharma’s deposits under Rule 114BA, as he has not exceeded the ₹20 lakh limit in either individual bank.
        • However, if Mr. Sharma deposited 21 Lakhs into his SBI account, SBI would then report the transaction.
      • It is very important to remember that even if the banks do not report the transaction, the Income Tax Department can still track high value cash transactions across all of a persons accounts.
  • Maximum amount of Cash Deposit in Saving Bank Account
    • There is no limit on how much cash you can deposit in your savings account.There is no limit on the maximum balance you can hold in your savings account . However, you need to be able to explain the source of any significant increase in your account balance.
  • Reporting to Income Tax Department
    • However, banks and post offices are required to report cash deposits of ₹10 lakh or more to the Income Tax Department.Exceeding this limit is considered a high-value transaction and may lead to scrutiny.
  • Number of Saving Bank Account a person can hold

There is no limit on the number of saving accounts you can hold . However, having too many accounts can lead to disadvantages like minimum balance requirements and bank charges

  • Online Transactions Limits in Saving Bank Account:
    • For online transactions via UPI, Paytm, PhonePe, etc. and cash Deposit, GST limits apply
      • For service-based businesses, the limit is ₹20 lakh
      • For goods-based businesses, the limit is ₹40 lakh
  • ITR Filing Requirment 
    • If you deposit ₹50 lakh or more in cash or online in a financial year, filing ITR is mandatory, even if your income is below the basic exemption limit
    • Scenario:
      • Mrs. Gupta has a savings bank account.
      • During the financial year 2025-26, she receives:
        • ₹20 lakh via electronic transfer from the sale of shares.
        • ₹35 Lakhs via cash deposit.
      • Analysis:
        • Mrs Gupta total deposits are 55 lakhs.
        • Even though a portion of the deposits were not cash, the total deposits exceed ₹50 lakh.
        • Therefore, according to Income Tax Rule , Mrs. Gupta is required to file an ITR for the financial year 2025-26.
  • Explanation of Cash Deposit in Bank

you need to be able to explain the source of cash Deposit  in your  Saving Bank account balance

  • Income Tax Rules if Cash Deposit or credit in Bank Account are unexplained

Tax can by imposed @ 60% tax  along with surcharge and cess. on unexplained Cash Deposit or credit entry in Bank . Income Tax Department can also impose Penalty. In some cases, a penalty equal to the deposited amount may be imposed under Section 271DA.

  • Investigation by Income Tax and GST Department

Exceeding these limits or depositing ₹50 lakh or more online may trigger scrutiny from the GST or Income Tax Department