Saving Account – Let us tell you that there is no limit on transactions in a savings account, but if more than a certain amount is deposited in a financial year, the Income Tax gets informed about it. In such a situation, you need to remain alert.
There is no limit on transactions in savings account, but if more than a certain amount is deposited in a financial year, Income Tax gets informed about it. The account holder has to give its details to the IT department. Apart from this, the income earned on savings account is also taxable.
In today’s time, it is necessary for every person, rich or poor, to have a bank account, because money from salary to wages and other government schemes comes directly into the accounts. There are many options available for opening accounts in banks like savings, current and salary accounts. However, most people in the country have a savings account.
People do most of the transactions in the country through savings accounts, but do you know how much money should be kept in a savings account? However, there is no limit on how much money you can keep in your savings account. But, if the money deposited in the savings account comes under the purview of income tax, then you will have to give information about it.
According to the Central Board of Direct Taxes, it is mandatory to give information about the amount of more than Rs 10 lakh in any bank account in a financial year. This limit also applies to investments in FD, mutual funds, bonds and shares.
At the same time, tax also has to be paid on the interest received on savings account, but there are some rules related to this. Under the Income Tax Act section 80TTA, no tax is levied on interest earned on savings account up to Rs 10,000 in a financial year for ordinary people. If the interest amount is more than this, tax has to be paid. However, for senior citizens this limit is up to Rs 50 thousand.
Not only this, the interest earned from the savings account is added to your income from other sources and then you have to pay tax on the total income as per the respective tax bracket.
Let us tell you that the leading government and private banks of the country are giving interest ranging from 2.70 percent to 4 percent on savings accounts. The interest rate on savings account with balance up to Rs 10 crore is 2.70 percent and for amounts above Rs 10 crore the rate is 3 percent. Apart from this, many small finance banks are offering up to 7 percent interest on savings accounts with conditions.
