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Is there any income tax issue... if we use more than 10lac rs from credit card in a financial year??
- Thread starter dino
- Start date
- Replies 30
- Views 3K
+1
Only if your usage is more than your income
If your income supports the spends, no issues.
And 10L+ spends are reported by the banks individually. Means if you spend 10L+ with a particular bank credit card, this bank will report it.
If you stagger the spends across cards, such that total spends are higher than 10L, then no reporting is done 🙂
Yes Thats correct. If one spends more than 10Lac annualy with a particular bank, its reported in ITR in the information section. In my case the spends were with two different cards from HDFC totaling above 10L and they were reported
It gets reported but you dont have to worry if your income is well above it
Also, No worries until you spend 90% of your net income in the financial year...
Example:
if you earn 25-30L (all white with paying all taxes), then no one can stop you to spend your money as you can provide proof
But if you report only 5L income and rest 15L is *cough* while using 7L+ on CC, then there are high chances of getting flagged 😛
dino
TF Premier
Bank won't report to the IT dept., but as your spends are higher than income, you may get IT notice.
Be prepared to reply appropriately, if that happens.
dino
TF Premier
To reply...i have to consult a CA...and i believe i have all the necessary documents.
My question is...if bank won't report to IT dept.....how they will the IT dept know that my spends are more than my income?
Banks from whom you have taken cc might not report to IT ,but your accounts from which you are paying those cards off might . Anyway there is nothing much to worry . IT generally don't scrutiny less than 40 LAKHS transactions a year, if you are in decent salary zone
Your PAN is everywhere bro. From bank to credit card to IT, everyone knows it.
Don't worry, there is a chance, not guaranteed that you will get IT notice.
All bank accounts, mutual fund SIP's, provident fund/PPF investments, demat and trading account transactions, real estate purchase/sale, electricity bill payments, credit cards, salary/business receipts everything is linked to PAN/Aadhar.
federer.reddevil
TF Ace
This year I made 2 transaction that were one Macbook for my friend and another one is a booking of marriage hall for friend since friend doesnt have high credit card limit he sent me cash while I paid in CC. So if I get notice what should I mention as I have got the cash in bank account itself and he has paid tax for his income
Don't worry. we all do it. purchase for friends and relatives.
If there is a financial benefit from the transaction as a statement credit (Mostly cashback cases- which gets credited separately ) they may ask you to pay the tax for that part.
Instant discount offers are way safer .
federer.reddevil
TF Ace
There was literally no cash benefit unless you count 200rs cashback in icici card
Will we have have to explain the purchases for crossing 10 Lakh for single bank