Think Your Bank Transactions Go Unnoticed? Think Again.
Your friendly savings account might seem private, but the Income Tax Department (ITD) has a sharp eye on high-value and unusual transactions.
Every bank is required to report specific activities to the ITD under the Annual Information Return (AIR) and Statement of Financial Transactions (SFT) framework.
So yes, even ordinary-looking deposits, transfers, or withdrawals could quietly flag your account for review.
Here Are the Common Transactions That Can Trigger Alerts
1. Cash Deposits of ₹10 Lakh or More
Deposit ₹10 lakh or more in your savings account (even in small parts) during a financial year, and your bank automatically reports it to the IT department.
2. High Credit-Card Payments
If you make large credit-card payments , especially when your declared income doesn’t justify the spending expect a red flag.
3. Frequent Large Cash Withdrawals or Deposit
Repeated big cash movements without a clear purpose can be marked as “*suspicious transactions*.” Banks must flag such patterns under anti–money-laundering norms.
4. Property Deals ₹30 Lakh or Above
Buying or selling property worth ₹30 lakh or more automatically triggers a data alert to the ITD through the registrar and your bank account.
5. Foreign Transactions Over ₹10 Lakh
Payments for foreign travel, overseas education, or forex cards 🌐 exceeding ₹10 lakh in a year are tracked under RBI and tax-reporting systems.
6. Sudden Large Credits in Dormant Accounts
Big amounts showing up in an inactive or dormant account can prompt an immediate investigation into the source of funds.
7. Mismatch in Interest or Dividend Income
If the interest or dividend credited by your bank/mutual fund doesn’t match what you declare in your ITR — it gets flagged under the Annual Information Statement (AIS).
8. Multiple Bank Accounts, Undeclared Interest
All your bank accounts are linked to your PAN/Aadhaar. Not declaring interest income from all of them can cause discrepancies and automatic scrutiny.
9. Using Someone Else’s Account for Large Transactions
Transferring or receiving large sums through another person’s account (a “benami” or third-party transaction) can attract money-laundering or unexplained income investigations.
Key Takeaway from Income Tax pouint of view:
Your banking activity must align with your declared income and ITR filings.
✅ Keep records and proofs for large deposits, withdrawals, or transfers.
✅ Avoid cash-heavy dealings without documentation.
✅ Ensure all interest and income from every bank account are properly disclosed.
In short. transparency and consistency are your best shields against unwanted tax scrutiny.
Professional Tip:
Review your Annual Information Statement (AIS) on the Income Tax portal regularly as it shows exactly what data the ITD already has about you.
Team- Intellex Strategic Consulting Private Limited
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