Income tax notice for credit card spends..

[VijayflyRaven]

Except for a few individuals, most of us are not experts when it comes to taxes. Therefore, we can only provide advice, but it is advisable to consult a CA. What you have done is already in the past, but now it's crucial to prepare for the future and take measures to prevent such incidents from occurring again.

Golden words.

One has to take action at least today and get professional help when required. Consulting a CA on a forum won’t be enough. Better to get help and file taxes showing appropriate income.

Don’t just depend on AIS and 10 lakhs spend. We get notice even for a small amount. Better to always spend below income. Otherwise be ready for an answer. It takes several years to receive notice.

 

[nitba]

Dear Technofino Members,

I hope this thread finds you well. I am reaching out to seek clarification regarding a financial matter that has recently come to my attention. I have heard rumors and received some conflicting information about potential legal consequences related to spending more than 11 lakhs in a single year. I would greatly appreciate it if you could provide me with accurate details and guidance on this matter.

To provide you with some context, I currently hold multiple credit cards and use them for various transactions. As part of my financial management strategy, I frequently add money to my bank account using one credit card and then utilize another credit card to pay off the bills. This allows me to effectively manage my credit utilization and maintain a healthy financial balance.

Recently, I discovered that my total transactions, when combining the funds added to the bank account via credit card and the subsequent credit card bill payments, have exceeded 10 lakhs+. I understand that the specific threshold for legal concerns may vary, and I want to ensure that I am fully aware of the applicable regulations.

EDIT: Although I have requested all the credit card companies to close my credit card mail sent waiting for their response.[/B]

Given this situation, I kindly request your assistance in providing accurate information regarding the legal implications of such financial activities. I would like to know if there are any specific thresholds or guidelines that could potentially lead to legal consequences, including the possibility of facing imprisonment.

Furthermore, I would appreciate any advice or recommendations on how to ensure compliance with financial regulations while managing multiple credit cards and maintaining a smooth and legal financial workflow.

I understand the importance of adhering to financial regulations and want to ensure that I am well-informed and compliant with all applicable laws. Your guidance on this matter would be of immense help in ensuring that I navigate the financial landscape appropriately.

Thank you for your attention to this matter. I look forward to your prompt response. Please reply to this thread.

 

[4uziaul]

This thread is for you

Income tax notice for credit card spends..

Hello everyone . It's Rule that Bank will report transactions above 10 lacs in a year by any person to income tax authorities.. i have seen many people rotating money by rent, bills payment or selling credit cards.. well infact, I am too a part of it.... Has anyone recieved notice from ITR...

www.technofino.in

 

[nitba]

This thread is for you

Income tax notice for credit card spends..

Hello everyone . It's Rule that Bank will report transactions above 10 lacs in a year by any person to income tax authorities.. i have seen many people rotating money by rent, bills payment or selling credit cards.. well infact, I am too a part of it.... Has anyone recieved notice from ITR...

www.technofino.in

Already read that's why worried 😫

 

[4uziaul]

Already read that's why worried 😫

The golden question is, then, why did you open this thread? 🤣 You could have asked the same question there because it's already being discussed there.

 

[nitba]

The golden question is, then, why did you open this thread? 🤣 You could have asked the same question there because it's already being discussed there.

I created account today i Don't know how to use this platform

 

[4uziaul]

I created account today i Don't know how to use this platform

Understood!!! 👍

 

[vaibhav111vaibhav111 is verified member.]

Dear Technofino Members,

I hope this thread finds you well. I am reaching out to seek clarification regarding a financial matter that has recently come to my attention. I have heard rumors and received some conflicting information about potential legal consequences related to spending more than 11 lakhs in a single year. I would greatly appreciate it if you could provide me with accurate details and guidance on this matter.

To provide you with some context, I currently hold multiple credit cards and use them for various transactions. As part of my financial management strategy, I frequently add money to my bank account using one credit card and then utilize another credit card to pay off the bills. This allows me to effectively manage my credit utilization and maintain a healthy financial balance.

Recently, I discovered that my total transactions, when combining the funds added to the bank account via credit card and the subsequent credit card bill payments, have exceeded 10 lakhs+. I understand that the specific threshold for legal concerns may vary, and I want to ensure that I am fully aware of the applicable regulations.

EDIT: Although I have requested all the credit card companies to close my credit card mail sent waiting for their response.[/B]

Given this situation, I kindly request your assistance in providing accurate information regarding the legal implications of such financial activities. I would like to know if there are any specific thresholds or guidelines that could potentially lead to legal consequences, including the possibility of facing imprisonment.

Furthermore, I would appreciate any advice or recommendations on how to ensure compliance with financial regulations while managing multiple credit cards and maintaining a smooth and legal financial workflow.

I understand the importance of adhering to financial regulations and want to ensure that I am well-informed and compliant with all applicable laws. Your guidance on this matter would be of immense help in ensuring that I navigate the financial landscape appropriately.

Thank you for your attention to this matter. I look forward to your prompt response. Please reply to this thread.

I frequently add money to my bank account using one credit card - first thing well written 👌 but I'm lost how come this is part of financial management? Rotating money to decrease credit utilisation ratio? This is news to me and why did you rotate money in large sums in the first place close to 50 thousand that fine but definitely you went overboard. Few things you considered are you salaried or self employed. 2nd other income source you get money credit in your account legit money not cc to bank.

 

[nitba]

I frequently add money to my bank account using one credit card - first thing well written 👌 but I'm lost how come this is part of financial management? Rotating money to decrease credit utilisation ratio? This is news to me and why did you rotate money in large sums in the first place close to 50 thousand that fine but definitely you went overboard. Few things you considered are you salaried or self employed. 2nd other income source you get money credit in your account legit money not cc to bank.

I am a student and i give tution to students and earns less than 5K a month

 

[vaibhav111vaibhav111 is verified member.]

I am a student and i give tution to students and earns less than 5K a month

Then and you have spend 10+ lakhs on one particular cc? Buying thing for others and paying cc to bank ♾️ now you shouldn't have close your all cc. You seem to understand the consequences so keep ltf card and paid card you can close. Now coming to the situation you would need to file ITR and have a word with a CA. he would guide you properly. Update us and get the file done before 31st july. Download via netbanking digital statement with you for reference.

 

[nitba]

Then and you have spend 10+ lakhs on one particular cc? Buying thing for others and paying cc to bank ♾️ now you shouldn't have close your all cc. You seem to understand the consequences so keep ltf card and paid card you can close. Now coming to the situation you would need to file ITR and have a word with a CA. he would guide you properly. Update us and get the file done before 31st july. Download via netbanking digital statement with you for reference.

Sir
These are details
Kotak 370K repayment of credit card bill and wallet load
HDFC. 300k loaded bank account
BOB. 270K loaded bank account
IDFC. 163K repayment of credit card bill and wallet load
ICICI. 5.6K shopping at Amazon

Only two cc are paid all other cc are LTF i currently holding 9 Credit Cards

 

[nitba]

Then and you have spend 10+ lakhs on one particular cc? Buying thing for others and paying cc to bank ♾️ now you shouldn't have close your all cc. You seem to understand the consequences so keep ltf card and paid card you can close. Now coming to the situation you would need to file ITR and have a word with a CA. he would guide you properly. Update us and get the file done before 31st july. Download via netbanking digital statement with you for reference.

Thanks for your guidance try contacting CA also my friend selected in Income tax this year through CGL22 i also selected in MEA but joining will be in 2025 i am worried that's why can't tell my family this Blunder 🤦 you don't believe i haven't sound slept since 18th June after came across this Blunder

 

[SSMV]

The ITR will be showing turnover and these expenses also, so nothing more to justify

My Credit Card spends crossed 25 lakhs from SBI and kotak
During House construction last year i have rotated money by for 6 months from both cards as i required lot of money for construction purpose as Housing loan took lot of time to get processed and i also availed personal loan on credit card which even that was included on card spends ,This years in AIS report banks reported 26 lakhs received for credit card as payment
I receive some money from my brother who is NRI to clear loans , and i even have own business running with Annual turnover of 35 lakhs and ITR filied is for 7 lakhs

Will i receive notice on 25 lakhs credit card payment and as per above information what can i do if i receive notice

 

[SSMV]

Sir
These are details
Kotak 370K repayment of credit card bill and wallet load
HDFC. 300k loaded bank account
BOB. 270K loaded bank account
IDFC. 163K repayment of credit card bill and wallet load
ICICI. 5.6K shopping at Amazon

Only two cc are paid all other cc are LTF i currently holding 9 Credit Cards

You need to be worried only if Spends are crossed 10 lakhs for 1 particular card issued bank and not for all combined cards

 

[vaibhav111vaibhav111 is verified member.]

My Credit Card spends crossed 25 lakhs from SBI and kotak
During House construction last year i have rotated money by for 6 months from both cards as i required lot of money for construction purpose as Housing loan took lot of time to get processed and i also availed personal loan on credit card which even that was included on card spends ,This years in AIS report banks reported 26 lakhs received for credit card as payment
I receive some money from my brother who is NRI to clear loans , and i even have own business running with Annual turnover of 35 lakhs and ITR filied is for 7 lakhs

Will i receive notice on 25 lakhs credit card payment and as per above information what can i do if i receive notice

you have answered to your own question. Bro you are self employed person with a business and this time ITR of 7 lakhs won't be enough this time so I hope you save your cc statement and next year filing send that to the CA and he will do the need full.

 

[vaibhav111vaibhav111 is verified member.]

Sir
These are details
Kotak 370K repayment of credit card bill and wallet load
HDFC. 300k loaded bank account
BOB. 270K loaded bank account
IDFC. 163K repayment of credit card bill and wallet load
ICICI. 5.6K shopping at Amazon

Only two cc are paid all other cc are LTF i currently holding 9 Credit Cards

It in multiple cc but you have taken that cash In your personal account though and you have received income more than taxable income. Just have a word with a CA. Even though my advice to file income tax is for spend or money received from 1st april 2022 to 31st march 2023. You didn't mention which year so I assume last year. If not them you have time to file income tax for next year.

 

[nitba]

It in multiple cc but you have taken that cash In your personal account though and you have received income more than taxable income. Just have a word with a CA.

Will do the same sir👍

 

[sonuu]

Let me repost one of my comments from another similar thread...

- You better start looking for a top tier CA who can probably justify your spends and somehow match income and expenses.

Don't want to sound negative but why would you do so much spends when your income is less than your spends (1/5th in your case). Were the rewards really worth it?

As far as the IT notice goes it can take upto 7 years for them to send you one. When it does you better have explanation ready for your numbers else tax penalty can go as high as 60% of expenses and in your case that would be in the ballpark of 25/30 Lakhs.

8 years i think. Aur ab to kuchh din me ye log bhi AI implement kar denge for automation in giving notice

 

[VISHESH_BANSAL]

CA - "Chartered Accountant" na ki
Chartered Jadugar.

Client hi support nhi karega proper txn trail ke saath toh CA bhi khuch manage nhi kar sakta.

Clien ne haat upar kar diye toh CA ke pass jadu thodi hai woh Bank Account se entry gayab kardega.

Bank m entry show ho rahi hai XXX party se YYY amount receive hua hai, toh ITD usko Income hi consider karega untill and Unless
Hum on paper proof kar paaye ki woh YYY amount humare ZZZ credit card se aaya hai ya phir kisi Freind/Family ke liye Txn ki thi toh reimbursement mila hai friend/family se.

CA ko thodi pta hai ki woh YYY amount kha se aaya hai .
Client ko hi txn trail bnake dena hoga
Client Proper trail nhi de paayega toh CA bhi kya Answer dega ITD ko

Agar Ek jhuth bologe toh 10 jhuth aur bolne padege.
Case utna hi complicated ho jaayega.

 

[vaibhav111vaibhav111 is verified member.]

CA - "Chartered Accountant" na ki
Chartered Jadugar.

Client hi support nhi karega proper txn trail ke saath toh CA bhi khuch manage nhi kar sakta.

Clien ne haat upar kar diye toh CA ke pass jadu thodi hai woh Bank Account se entry gayab kardega.

Bank m entry show ho rahi hai XXX party se YYY amount receive hua hai, toh ITD usko Income hi consider karega untill and Unless
Hum on paper proof kar paaye ki woh YYY amount humare ZZZ credit card se aaya hai ya phir kisi Freind/Family ke liye Txn ki thi toh reimbursement mila hai friend/family se.

CA ko thodi pta hai ki woh YYY amount kha se aaya hai .
Client ko hi txn trail bnake dena hoga
Client Proper trail nhi de paayega toh CA bhi kya Answer dega ITD ko

Agar Ek jhuth bologe toh 10 jhuth aur bolne padege.
Case utna hi complicated ho jaayega.

true - that the reason even though i don't do Ek ka do and do ka teen, i'm been using excel from last 2+ yr since using cc daily for businesfor example-

date	Transcation	Amount	Pay by	Dr/Cr
1st	Jio Recharge		SBI Cashback	Dr
1st	xxxxx		Amazon Pay Balance
2nd	xxxxx		Current	Dr
2nd	xxxxx		Cash	Dr
2nd	xxxxx		UPI/Current	Dr
3rd	xxxxx		Cash	Cr
4th	xxxxx		HDFC Tata Neu	Dr
5th	xxxxx		HDFC Tata Neu	Dr
5th	xxxxx		HDFC infinia	Dr
5th	xxxxx		Amazon Pay Balance
6th	xxxxx		HDFC Tata Neu	Dr
6th	xxxxx		Saving	Dr
8th	xxxxx		HDFC Tata Neu	Dr
9th	xxxxx		HDFC Infinia	Dr
10th	xxxxx		HDFC infinia	Dr
7th	xxxxx		Current	Cr
14th	xxxxx		ICICI Plantium	Dr
14th	xxxxx		Amazon Shopping Voucher Balance	Dr
14th	xxxxx		SBI Simplyclick	Dr
15th	xxxxx		ICICI Plantium	Dr
16th	xxxxx		AMEX MRCC	Dr
18th	xxxxx		SBI Cashback	Dr
17th	xxxxx		SBI Cashback	Dr
20th	xxxxx		SBI Cashback	Dr
19th	xxxxx		SBI Cashback	Dr
19th	xxxxx		SBI Cashback	Dr
19th	xxxxx		Current	Cr
19th	xxxxx		Current	Cr
19th	xxxxx		Saving	Cr
19th	xxxxx		Saving	Dr
19th	xxxxx		Saving	Cr
20th	xxxxx		Current	Dr
20th	xxxxx		Current	Dr
20th	xxxxx		Current	Dr
21st	xxxxx		SBI Simplyclick	Dr