Can you avoid tax on cash?

The tax helpline of Cleartax hasn't stopped ringing since 9 November when Indians woke up to demonetisation of Rs 500 and Rs 1,000 notes. "People are calling up to know how they can declare the cash they hold without incurring a tax liability," says Archit Gupta, Founder and CEO of the tax filing portal.

Tax professionals say that honest taxpayers have nothing to fear. "If you have Rs 500 and Rs 1,000 notes lying with you, there is no reason to panic if you can explain the source of cash," says tax and investment expert Balwant Jain. You can go and deposit it in your bank or exchange it for new notes. But, as tax officials have warned, the cash you deposit in the bank must match the income declared in your tax return. "We would get the details of accounts in which more than Rs 2.5 lakh have been deposited. Any mismatch with income declared by the account...Read More

Source Web Page : Times of India


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