The Income Tax Department (ITD) doesn’t just track your salary or business income—it also keeps a close eye on certain banking and financial transactions. Any discrepancies or unreported amounts can trigger immediate notices. Here are 10 key transactions you should always be careful about:
1. Large Cash Deposits 💵
· Deposits above a certain threshold in your bank account are automatically reported to the ITD.
· Frequent large deposits can invite scrutiny if not properly explained.
2. Fixed Deposit (FD) Transactions 🏦
· Opening or prematurely withdrawing high-value FDs is tracked.
· Interest earned from FDs must be declared in your income tax returns.
3. Credit Card Bill Payments 💳
· Paying high credit card bills through cash or unusual means is monitored.
· Ensure all payments are within declared income limits.
4. Property Purchases & Sales 🏠
· Buying or selling immovable property above the ITD-specified limit triggers reporting.
· Always maintain proof of source of funds to avoid notices.
5. Investments in Mutual Funds & Stocks 📈
· Buying or redeeming mutual funds and shares worth over ₹10 lakh annually is reported.
· Ensure all capital gains are properly declared.
6. Foreign Remittances & Transactions 🌐
· Sending or receiving money abroad beyond permitted limits attracts attention.
· Make sure Form 15CA/15CB filings are accurate.
7. High-Value Insurance Premiums 🛡️
· Paying large insurance premiums may be reported.
· Premiums for policies above certain amounts must be justifiable with your declared income.
8. Loans Taken or Repaid 💰
· Loans above a certain threshold from banks or non-banking sources are tracked.
· Ensure proper documentation is available for the loan source and repayment.
9. Cryptocurrency Transactions ₿
· Buying, selling, or trading crypto is now closely monitored by the ITD.
· Tax on gains from crypto must be accurately reported to avoid penalties.
10. Luxury & High-Value Goods Purchases 🛍️
· Buying vehicles, jewelry, or other expensive items can trigger scrutiny.
· Make sure funds for such purchases match your declared income.
✅ Takeaway:
The Income Tax Department monitors various banking and financial transactions beyond your salary. Proper record-keeping and timely reporting can help avoid notices and penalties. Always ensure that your financial activities align with your declared income.
Disclaimer:
The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of any agency, organization, employer, or company. All information provided is for general informational purposes only. While every effort has been made to ensure accuracy, we make no representations or warranties of any kind, express or implied, about the completeness, reliability, or suitability of the information contained herein. Readers are advised to verify facts and seek professional advice where necessary. Any reliance placed on such information is strictly at the reader’s own risk..jpg)
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