According to Indian government rules, how much cash can a person keep at home? If the amount is more than what is the penalty?

New Delhi, Dated 18 January 2023, Wednesday

According to the old tradition in India it is a practice to keep cash at home for any emergency. Banks provide many types of facilities to their customers, but even today people give more importance to keeping money at home for any sudden emergency. However, how much rupees can be kept in the house, what is the limit? Do you have to report the cash in the house after a certain amount to the income tax? The answer is no. You can keep as much cash at home as you like and it is not mandatory to give this information to any authority. However, you should have information about the legally recognized source of the cash you have, as well as relevant documents. That is, you should keep the knowledge of how these rupees came to you.

If someone has a large amount of cash at home and the Income Tax department raids that home, the officer will demand these documents. If the cash you keep at home is subject to tax, tax must be paid on it. If one is missing the source and the relevant document to pay the tax, he can be in big trouble.

Not only Income Tax Department, ED and CBI can also inquire from you. However, if you have the right document, you have nothing to fear. If you are asked about the source of cash in the income tax department red and you cannot show the correct document, or the document is defective, you may be penalized. This penalty will be very heavy.

According to the Income Tax Department, 137 percent of the cash earned in your home, you have to pay as penalty. That means, you will have to pay 37% extra on top of the amount of cash you have kept.