Just declared by the Modi government that Rs 500 and Rs 1000 note will be banned from today midnight. It can be used only in bank railway and hospital the news is like earth Quake in indian economy.
Why Ban on Rs500 and Rs1000 note.
Government has taken such decision to reduce the black money in the country with an overall objective to reduce terrorism activity. Some people are also saying it has been done for the upcoming UP election.
What is black money
Black money is any money which people earned and not pay proper tax to the government’s.
RBI Guidelines on Old Indian Currency
Rs 500 and Rs 1000 note will not be applicable on or after 08/11/2016, Only can be deposit in the banks or exchange from the banks. Old note of 500 and 1000 is not a legal tender from 08/11/2016 mid night, Any person cannot accept this notes.
You can only deposit the money you want but not able to withdraw more than Rs 24000 from banks in a single day from saving accounts and 50,000 from Current accounts.
Legal solution for Rs500 and Rs1000 old Note
People can deposit the money in the banks.Pls note there should be valid source of income for deposit money in the banks.
Deposit Rule of 2.5 laks
Deposits above Rs 2.5 lakh to face tax, 200% penalty on income mismatch – If you have deposit more than 2.5 lakh in bank account and not shown in ITR than it will be applicable.
Note this will be applicable on per PAN number not as per bank accounts.
If a person have one pan number and three bank accounts than he can deposit Rs 2.5 laks only in all bank accounts.
Can I deposit 2.5 in saving and 2.5 in current accounts –
You can deposit only Rs 2.5 laks in all saving and current accounts as per one pan.
How much money can be deposited in the banks.
People can deposit the white money in the banks upto which –
Income has been shown in Income tax return and
Cash has been shown in balance sheet and
Cash withdrawn from the banks in the current year.
Can I deposit money in the savings bank or Current accounts.
You can deposit in both the accounts as per the books of accounts
Things to be check before depositing the money in current accounts.
Need valid source of the income to deposit the money in the banks. like
Cash sales – Cash sales done till 08/11/2016 will be valid, you can not collect the cash after that date as the money is not a legal tender.
Service tax will be attract if you are liable to pay service tax.
Vat will be attract if you are liable to pay vat.
TCS will be applicable for cash sales of more than 2 laks click here to view the full article TCS on cash transaction
Note – The limit on Current bank accounts is 9 laks per day, but if you are giving the declaration than you can deposit any amount in the banks. Many Expert are of opinion give the declaration and deposit the money in a Single time. Second time deposit will be treated as black money.
Things to be check before depositing the money in saving accounts.
Need valid source of the income to deposit the money in the banks.
If more than Rs 2 laks deposited in saving bank in a day and Rs 10 laks in a year than it will reported in a income tax.
Deposits above Rs 2.5 lakh to face tax, 200% penalty on income mismatch – If you have deposit more than 2.5 lakh in bank account and not shown in ITR than it will be applicable.
How to exchange money in the banks
People can exchange the money in the bank accounts by filing the proper form in any branch of the banks.
Form for Deposit of Old money
For more information you can click on this link
Effect of Ban on Rs 500 and Rs 1000 note on economy
Gold price will be increased
Real estate price will fall
Sensex may be down for the short term but it will good news for the long term investor
Heavy Crowd in banks for the whole month
It is wonderful effort by the modi government to reduce the black money.
Who faced major Problem by ban in Rs 500 Rs 1000 Note
1. People who go for the travel trip by taking Rs 500 and Rs 1000 note will suffer as they have no option as hotel and travel agency will bot accept the notes.
2. People who don’t have 100 rs note in the home. he cant purchase anything by rs 500 note from today onward.
3. People who have stored black money in the home special Pin money of Women.
