Income Tax Rule: 90 percent of people do not know that tax is also levied on money kept in a savings account...
Nowadays almost every person uses a savings account. Bank accounts have become very important in today's time. In a family, children also have accounts along with their parents. Be it salary or scholarship, everyone requires a bank account number. However, no limit has been set regarding the maximum amount deposited in the savings account. But very few people know that the interest you get on a savings account comes under the purview of income tax.
Many people in the country deposit their savings in bank accounts. Today in this article we will tell you when and how much tax is levied on savings accounts. According to Income Tax rules, how much tax is levied on the savings account?
For information, let us tell you that there are two types of bank accounts – one is a savings account and the other is a Current Account. People who open an account to save money select the option of saving an account.
If we talk about savings account benefits, the bank provides many benefits like interest in it. Many people do not know that the interest received on the amount deposited in the savings account is not tax-free. This means that we have to pay tax on savings accounts also.
Know when tax is levied on savings account
There is no limit to depositing money in a savings account. Many bank holders are not even required to maintain a minimum balance. But when more than a limit is deposited in the savings account, then the account holder has to pay tax on it.
In such a situation, you should keep in mind that you keep only that much money which comes under the purview of ITR (Income Tax Return). If you keep more money in the account than that, you will have to pay tax on the interest received by the bank.
Tax is levied on this amount
According to the Income Tax section, interest received from a savings account is also counted as income. In such a situation, if the annual income of an account holder is Rs 10 lakh he gets interest of Rs 10,000 on his savings account. Including this interest, his annual income will now be Rs 10,10,000. This income is taxable as per the Income Tax Act. This means that now the account holder will have to pay tax on interest.
Give information about saving accounts to income tax
According to the rules of the Income Tax Department, if a person keeps more than Rs 10 lakh in cash in his savings account in one business year, then he should inform the Income Tax Department.
If they do not do so, the department can also take action against tax evasion. Let us tell you that Rs 10 lakh will be considered as income and it is taxable.
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