A Thread regarding credit card spends and Income tax notice.....

[Batmanbaba]

As per the CBDT norms,

1. Payment of ₹1 lakh or more in cash against credit card bills should be reported to income tax department.


2.Additionally, if payment of ₹10 lakh or higher is paid in a financial year to settle credit card bills by any other means like NEFT, UPI or apps like CRED, the payment must be disclosed to the tax department.


This is quite an important thread but not here on the forum

Things I want Insights from other members

1. Is this 10 lakh limit

A- per pan card
Or
B- Per credit card company like if you have two sbi cards and total spends on both card combined/ individually exceeds 10 lakh then sbi has to report to Income tax department
Or
C- It is card issuing provider like visa/ mastercard / rupay limit
Or


D- it is per credit card limit that we can spend upto 10 lakh per credit card unreported.

A lot of people don't spend in actual 10 lakh... As we all know.... A lot of people use different techniques to rotate money.. And spike the spends... For rewards.... Or limit enhancement or fulfilling LTF criteria or for card upgrade purpose....


For them How to tackle situation if anyone indeed gets notice

1. If he his filling ITR and spends are way above ITR

2. If not filling ITR, then I guess only Modi ji can save him or giving a election bond in favour of bjp or any other way to get out.... 😉🤔



Request the administrator to pin this thread.... It's way important than anyone thinks....

 

[vysakh]

If your net spends are below your ITR, you have nothing to worry. If they are higher, you may have to explain that you're not money laundering. Good luck with that!

 

[Batmanbaba]

1. Per PAN card.

But I dont think.... Credit card companies share data with each other of spends.... And they have to report your usage only if it crosses 10 lakh.. On their cards.... They have liability to share only then....

 

[KumarS]

Fine, but they will share only if the a) spend is more than 10 Lacs or b) IT dept specifically asked for

So if I'm spending 6 Lacs and 4 Lacs across two bank, I don't think it's issue, as long as total is below your total earned income for the year.

 

[Parveshgarg]

No man its not per PAN card its on the basis of per credit card provider like SBI. Axis and HDFC etc. co doesn't share data with each other........

Payments made by any person of an amount aggregating to— (i) Rs. 1 lakh or more in cash; or (ii) Rs. 10 lakh or more by any other mode, against bills raised in respect of one or more credit cards issued to that person, in a financial year

A banking company or a cooperative bank or any other company or institution issuing credit card.

Since the onus of reporting on company so it is per issuer (SBI, HDFC & Etc.)

 

[Akashgod]

Not per pan card 100% bcoz I have used 9 lakh 1 1 card and 4 lakh in other card last year.. ntg is seen in any report. It is per bank 10 lakh

 

[Akashgod]

Report meaning AIS in which credit card transactions above 10 lakh reflect and in no way per pan card basis 10 lakh it is per bank basis

 

[Akashgod]

As per the CBDT norms,

1. Payment of ₹1 lakh or more in cash against credit card bills should be reported to income tax department.


2.Additionally, if payment of ₹10 lakh or higher is paid in a financial year to settle credit card bills by any other means like NEFT, UPI or apps like CRED, the payment must be disclosed to the tax department.


This is quite an important thread but not here on the forum

Things I want Insights from other members

1. Is this 10 lakh limit

A- per pan card
Or
B- Per credit card company like if you have two sbi cards and total spends on both card combined/ individually exceeds 10 lakh then sbi has to report to Income tax department
Or
C- It is card issuing provider like visa/ mastercard / rupay limit
Or


D- it is per credit card limit that we can spend upto 10 lakh per credit card unreported.

A lot of people don't spend in actual 10 lakh... As we all know.... A lot of people use different techniques to rotate money.. And spike the spends... For rewards.... Or limit enhancement or fulfilling LTF criteria or for card upgrade purpose....


For them How to tackle situation if anyone indeed gets notice

1. If he his filling ITR and spends are way above ITR

2. If not filling ITR, then I guess only Modi ji can save him or giving a election bond in favour of bjp or any other way to get out.... 😉🤔



Request the administrator to pin this thread.... It's way important than anyone thinks...

To tackle the situation.
U can show family money, say given by any of ur family members. But the credit transaction shd be there from a taxpayer*

 

[AllSeeker]

Good thumb rule is being below 5 lacs or your overall total filed ITR.

Think about it, if you spend more than couple of lacks, when you pay it will be coming through some bank account, usually your bank will do the reporting of the transaction if it is above certain limit. Even if you have a higher verient account, there has to be a reporting limit. This is by product of having to pay large sums as credit card bill.

Now actual credit card, I don't think banks share that data as transparently as IT department would like. So you are fairly safe as long its not an issue for you to make payments of that much sum through your actual bank account.

 

[AllSeeker]

It's safer to assume that everything is reported and to maintain accordingly.

Indeed, but then again its below 5 lacs IT department will not really care about it. Since that would be too poor for them to investigate

 

[Sub]

Few quick points:

• 10 Lakhs is based on your PAN card, and not bank account/CC account/...
• Entry in AIS is not an IT notice. It's more an information that you need to be aware of when filing your return as a discrepancy there and what you file will likely result in a notice
• Most notices are automated, and the analytics systems are pretty high-end. So no, spending 9.8 lakhs or 10.1 lakhs is not the question, but a variety of other parameters which the system is trained to spot which will collectively trigger an alert or not
• Don't do manufactured spending or buying way beyond your income for friends/family.
• IT notices are not a fun affair. They eat into your time and wear you down - even for a plain vanilla salaried individual.
• Anytime you use a digital payment instrument (either a CC transaction or bank payment to CC), assume that the data is sitting against your PAN card with the Government. Not a bad thing per se, given the low level of tax compliance in India, but don't assume otherwise.

 

[AllSeeker]

Few quick points:

• 10 Lakhs is based on your PAN card, and not bank account/CC account/...
• Entry in AIS is not an IT notice. It's more an information that you need to be aware of when filing your return as a discrepancy there and what you file will likely result in a notice
• Most notices are automated, and the analytics systems are pretty high-end. So no, spending 9.8 lakhs or 10.1 lakhs is not the question, but a variety of other parameters which the system is trained to spot which will collectively trigger an alert or not
• Don't do manufactured spending or buying way beyond your income for friends/family.
• IT notices are not a fun affair. They eat into your time and wear you down - even for a plain vanilla salaried individual.
• Anytime you use a digital payment instrument (either a CC transaction or bank payment to CC), assume that the data is sitting against your PAN card with the Government. Not a bad thing per se, given the low level of tax compliance in India, but don't assume otherwise.

Very helpful, thanks!

 

[Akashgod]

It is not on pan card. If that was pan card then I would already have got it in AIS report. Further I also confirmed with tehcnofino sir. It's not pan card. Don't confuse. Keep spending! 😃

 

[iamnhm]

Just a question does my Slice card also come under the same rules??

 

[Akashgod]

No it's a loan product!

 

[pal8ul]

It is not on pan card. If that was pan card then I would already have got it in AIS report. Further I also confirmed with tehcnofino sir. It's not pan card. Don't confuse. Keep spending! 😃

IT notice = PAN card basis, generated by IT dept, purpose is addressing tax non-compliance
AIS reporting = per bank basis, generated at bank level, purpose is information reporting only for benefit of tax payer to help him avoid discrepancy

both are not the same thing and has diff purposes. probably, that causes bit of confusion.