365Telugu.com online news, November 13th,2024: Credit card users should be cautious with certain high-value transactions that could trigger an alert from the Income Tax Department. Here’s a guide to seven types of transactions that might lead to an income tax notice:
- High Spending on Foreign Travel
Spending over ₹2 lakh on foreign travel in a year? This information is reported directly to the Income Tax Department and may attract scrutiny. - Large Credit Card Expenses
Credit card spending exceeding ₹2 lakh annually raises red flags. The Income Tax Department monitors high credit card expenses for unusual patterns. - Cash Payments Over ₹1 Lakh for Credit Card Bills
Avoid paying credit card bills in cash if the amount exceeds ₹1 lakh. Large cash payments often invite closer examination by tax authorities. - Significant Investments in Mutual Funds and Stocks
Investing more than ₹10 lakh in mutual funds, stocks, or bonds in a single year is reported to the Income Tax Department and can prompt a review. - Purchases of High-Value Property
Purchasing property worth ₹30 lakh or more automatically alerts the tax department, as large real estate transactions are closely monitored. - Large Cash Deposits in Bank Accounts
Depositing over ₹10 lakh in cash in a bank account can trigger a notice. The department watches for high cash deposits as they may indicate unreported income. - High-Value Cash Transactions in Business
Cash business transactions over ₹50,000 are monitored, so ensure proper documentation to avoid inquiries from tax authorities.
To reduce the risk of receiving a notice, avoid these transactions where possible or maintain thorough records.