Archive · 7 Dec 2025
India's New Tax Rules Impose Heavy Penalties on Cash
India has new rules about handling cash.
If you have a lot of cash at home and can't explain where it came from, you might have to pay a very high tax of 84%.
This includes penalties and extra charges.
Banks will tell the tax department if you withdraw a lot of cash.
If you take out more than ₹20 lakh, the bank will even take out some tax right away.
There are also new rules about receiving cash for things like selling property or getting loans.
The government is trying to stop people from hiding money, so it's important to keep good records of all your transactions.
Unexplained cash found during a search may attract an 84% tax, including penalties, surcharges, and cess.
Banks will report cash withdrawals over ₹10 lakh to the Income Tax Department and deduct TDS on withdrawals over ₹20 lakh.
Receiving over ₹2 lakh in cash from a single customer in a day, accepting cash loans of any amount, or receiving over ₹20,000 in cash when selling property can result in a 100% penalty.
The government is cracking down on black money and unaccounted wealth with stricter enforcement and better data-sharing between banks and tax authorities.
Individuals and small businesses are advised to document all cash transactions to avoid financial penalties.
- Who
- Individuals and businesses in India
- What
- New tax rules imposing heavy penalties on cash transactions and unexplained cash
- When
- Currently in force
- Where
- India
- Why
- Government crackdown on black money and unaccounted wealth
- Penalty for unexplained cash
- 84%
- Cash withdrawal limit for TDS
- ₹20 lakh
- Cash transaction limit for property sales
- ₹20,000
- Cash transaction limit for single customer
- ₹2 lakh
- Cash withdrawal reporting limit
- ₹10 lakh