SBI Alert! Do this to avoid paying tax on cash withdrawal above this amount

If you are a State Bank of India (SBI) customer and you withdraw cash of Rs 20 lakh and above in a year, then this tax saving advice from the bank will be of great help to you. The largest public sector lender tells how customers can save themselves from paying unnecessary TDS (Tax Deducted at Source) on cash withdrawals of Rs 20 lakh and above. All you have to do is follow these 3 simple things.

TDS under section 194N is applicable on cash withdrawals over Rs 20 lakhs if Income Tax Return (INR) is not filed for the past 3 years, the bank says.

See SBI Tweet:

Here’s how you can save yourself from paying unnecessary TDS on cash withdrawals over ₹20 lacs. Just follow these 3 simple protocols. #SBI #StateBankOfIndia #Tax #TDS #SaveTax #ITReturns pic.twitter.com/Ug1w8lhrk8

— State Bank of India (@TheOfficialSBI) July 3, 2020

This valuable information has been shared by the bank on its official Twitter handle @TheOfficialSBI.

Customers with cash withdrawals over Rs 20 lakhs need to do this:

1) Submit your PAN details to the bank if already not done.
2) Non-availability of PAN leads to higher deduction of tax.
3) Submit your IT return details to your bank.

If ITR is not filed for any of the last 3 years, then following rates will be applicable with effect from 1 July 2020:

1) Cash withdrawal up to Rs 20 lakhs – Nil interest rate of TDS whether PAN is available or not in the CIF/account
2) Cash withdrawal from Rs 20 lakhs to Rs 1 cr --  2 per cent interest rate of TDS if PAN is available in the CIF/account and 20 per cent if PAN is not available in the CIF/account
3) Cash withdrawal in access of Rs 1 cr -- 5 per cent interest rate of TDS if PAN is available in the CIF/account and 20 per cent if PAN is not available in the CIF/account

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SBI further says that for customers who have filed their ITR for the past 3 years, the tax will be continued to be deducted at the 2 per cent rate on amount exceeding Rs 1 cr.