Outlook Money
With digital banking, the trend of keeping money in bank accounts has also increased rapidly. Today about 80 per cent of people in the country have a bank account.
One can deposit as much money as one wants. But, if the amount deposited in the account comes under the purview of income tax, then one has to give official information about it. Besides, the source of income will also have to be mentioned.
There is no limit to keeping money in a savings account. If one deposits more than Rs 10 lakh in a bank in a financial year, then it is necessary to inform to the Central Board of Direct Taxes (CBDT).
If more than Rs 10 lakh is deposited, the Income Tax Department can ask its source. If they are not satisfied with the answer, they can also investigate. If caught during the investigation, one may face a heavy fine of a 60 per cent tax.
There is no point in keeping a huge amount in a savings account. One can invest this money in various investment tools including the stock market or mutual funds, in which one can get good returns.
If one wants to avoid risks or wants to keep the money in the bank, then one can make a fixed deposit (FD). This can also get good returns.
Compiled by Syed Muskan