India’s cash deposit rules changed from 1 April 2026 after the Income-tax Act, 2025 and Income-tax Rules, 2026 replaced the older framework. For an ordinary cash deposit into a bank or post-office account, PAN quoting is now linked to aggregate deposits of ₹10 lakh or more during a financial year. Deposits remaining below ₹10 lakh do not trigger PAN quoting solely under this transaction category.
Banks still follow KYC and anti-money-laundering checks, while unusual activity can be examined regardless of value. A separate ₹20 lakh threshold also requires PAN compliance across one or more accounts.
What Is The New PAN Limit For Cash Deposits In 2026?
Rule 159 of the Income-tax Rules, 2026 lists transactions where PAN must be quoted. For cash deposits with a bank, cooperative bank or post office, the threshold is aggregate deposits of ₹10 lakh or more in one financial year across one or more accounts belonging to the same person.
This is not a per-visit allowance. Ten deposits of ₹1 lakh reach the rule just like one ₹10 lakh deposit. A depositor staying below ₹10 lakh generally need not quote PAN merely because of this cash-deposit entry.
The wording makes “below ₹10 lakh” more accurate than “up to ₹10 lakh.” Once the total reaches ₹10 lakh, PAN becomes applicable. See the official Income-tax Rules, 2026.
Which Three Cash Deposit Rules Should Customers Track?
The 2026 framework has three connected checkpoints:
- ₹10 lakh PAN checkpoint: Aggregate cash deposits of ₹10 lakh or more during a financial year require PAN quoting under Rule 159.
- Form 97 and PAN application: A person without PAN may submit Form 97 for eligible specified transactions. However, a non-company or non-firm entering transactions listed at serial numbers 1 to 10 must apply for PAN.
- ₹20 lakh annual checkpoint: Rule 161 covers cash deposits aggregating to ₹20 lakh or more during a financial year across bank or post-office accounts. PAN must be quoted and authenticated in connected documents.
The Income Tax Department announced that the rules were notified and published in the e-Gazette. Its official X postgives readers direct confirmation instead of relying on forwarded claims.
Does The ₹10 Lakh Reporting Rule Still Apply?
Yes. Banks and post offices also report specified high-value transactions. Cash deposits aggregating to ₹10 lakh or more in savings-type accounts, excluding current accounts and time deposits, fall within Statement of Financial Transaction reporting.
Current accounts have a separate ₹50 lakh threshold for aggregate cash deposits or withdrawals during a financial year. Reporting lets the department compare deposits with returns and declared income.
The department’s high-value transaction guidance says accounts of the same nature are aggregated. Splitting cash among similar accounts is therefore not a dependable way to avoid reporting.
Can A Bank Question Deposits Below The PAN Threshold?
Yes. Banks monitor unusual or inconsistent activity under KYC and anti-money-laundering controls. A sudden ₹8 lakh deposit in a rarely used salary account may attract attention even though it remains below ₹10 lakh.
Cash is not taxable merely because it enters an account. A problem can arise when the depositor cannot connect it to a legitimate source, such as recorded business sales, earlier withdrawals, agricultural receipts, property proceeds, gifts, loans or accumulated savings.
Keep records matching the explanation. Keep invoices, cash books, sale agreements, withdrawal slips, gift deeds and tax returns. A bank can also seek identity or source documents under its internal risk process.
What Should Depositors Do Before Taking Cash To A Bank?
First, calculate every cash deposit made since 1 April across accounts held in the same name.
Second, carry PAN once the yearly total approaches ₹10 lakh. A customer without PAN should ask the bank whether Form 97 applies or whether a PAN application is required.
Third, retain source records. Traders should reconcile cash sales with books and GST records where applicable. Families depositing gifts, sale proceeds or household savings should preserve supporting documents.
Finally, cash receipt restrictions are separate from deposit rules. Restrictions can apply when a person receives ₹2 lakh or more in cash in specified circumstances. Depositing that money later does not automatically fix a prohibited receipt.
Final Word
The main 2026 figure is ₹10 lakh, not ₹50,000, for aggregate cash deposits requiring PAN under Rule 159. PAN compliance also applies at ₹20 lakh, while SFT reporting can begin at ₹10 lakh for eligible savings accounts. Total deposits across accounts and keep proof showing where each large cash amount came from.
FAQs
1. How Much Cash Can Be Deposited Without PAN In 2026?
Cash deposits below ₹10 lakh annually avoid this specific PAN rule, subject to bank checks.
2. Is The ₹10 Lakh Limit Per Bank Account?
No, deposits across one or more accounts belonging to the same person are aggregated annually.
3. What Happens When Cash Deposits Reach ₹20 Lakh?
PAN must be quoted and authenticated under Rule 161 for covered bank or post-office deposits.
4. Are Cash Deposits Of ₹10 Lakh Automatically Taxable?
No, tax depends on the money’s source, records, declared income and relevant applicable tax provisions.
5. Can Banks Ask Questions Below ₹10 Lakh?
Yes, banks may seek source documents whenever activity appears unusual, inconsistent or potentially suspicious patterns.
