Cash and Gold at home: If you have not yet shown the information about your cash, gold, jewelery or any kind of investment in the Income Tax Return (ITR), then its source of income will not be considered as valid evidence in any way, so be a little careful. However, the Income Tax Department considers such cases as ‘undeclared income’ and collects heavy tax and penalty ranging from 78 percent to 86 percent.

Understand the complete mathematics of tax and penalty here

In fact, under Section 115BBE of the Income Tax Act, there is a provision for strict financial penalty on undisclosed assets or cash. In which, first of all, only 60 percent tax is levied directly on undisclosed income. Not only this, a percentage surcharge and 4 percent cess is added to the tax, due to which the total tax liability increases to 78 percent.

On the other hand, if you are completely unable to reveal the source of the money, then an additional penalty of 10 percent is imposed under Section 271AAC, taking the total recovery to approximately 86 percent.

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What are the rules for keeping cash and gold at home?

Whenever you keep cash and gold in your house, do not forget to follow these rules. There is no legal maximum limit on keeping cash at home, provided that the money is part of your legitimate and tax-paid income and can be accounted for in the account books. Talking about the exemption for keeping jewellery, keeping in mind the Indian culture, permission has also been given to keep a certain amount of gold without disclosing its source. In which a married woman can keep up to 500 grams of gold and an unmarried woman can keep up to 250 grams of gold in her house. Within this fixed limit, the Income Tax Department will never be able to confiscate your jewellery.

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If you get caught in the trap of any kind of tax evasion and heavy fine, then the Government of India has also given the option of filing Updated ITR to avoid this. Even after receiving the reassessment notice, if a citizen declares his correct income, he can easily avoid punitive action.