Do you ever wonder how much money one could stash in a house today? In May 2025, Income Tax Department introduced major reforms regarding rules concerning maximum cash limits which concern every citizen of the nation. With these new provisions, the maximum limit for cash storing in a house and various norms regarding its documentation have been changed. Let us know in detail what the new rules want to say and what is the penalty in case they are not followed.
What Is The New Limit For Keeping Cash?
New tax rules are made by the Income Tax Department, according now to which a person can keep Rs 20 lakh cash in his residential premises, reduced from the previous limit of Rs 50 lakh. However, for marriage, this may be raised by an additional Rs 5 lakh, for which it has to be proved that one has to get married.
New Provisions Regarding Cash Transactions
Under the new provisions, the requirement of providing PAN card and Aadhar card details would now apply to cash transactions exceeding Rs 2 lakh. Also, annually, whoever makes a cash transaction exceeding Rs 10 lakh will have to inform the Income Tax Department about it.
Penalty For Violating The Rules
If a person keeps cash beyond the prescribed limit, he may be fined up to 50% of the amount above the limit. In addition to this, anyone infringing the cash-related rules can be penalized with up to Rs 10,000 or 2% of the transaction amount, whichever is higher.
What Is The Purpose Of These Rules?
These rules are meant to reduce black money and cash transactions. The government wants to encourage digital and cashless transactions and reduce tax evasion through these rules. This step has been initiated in order to achieve some transparency in the country and move towards a more formalized economy.
Advice For Citizens
According to financial analysts, citizens must:
- Keep cash only within legally permitted limits.
- Use banking channels for any large transactions.
- Document all financial transactions properly.
- Retain proper proof of holding cash during emergencies.
Conclusion
It remains the responsibility of every citizen to conform and comply with the new rules. Cash over and above the prescribed limit should be deposited. Digital means should be adopted for big transactions. Following these norms not only will help you avoid running afoul of the law, but also strengthen the economy of the country.
Also Read: Relief for Pensioners: New Pension Rules 2025 Bring Major Benefits