Many of you are transferring money from tez, Paytm, Phonepe or any other wallet and i am sure you are thinking if you have to pay tax on Paytm Transaction, or Will i have to Pay on Phonepe Transaction? So in this post i will provided details on Tax on Paytm and Phonepe Transactions. Also at the end of the post we have answered the question if you have to pay tax on cashback?
These details i have gathered from other sites and from google, also if you also know anything about Tax on paytm Transaction or tax on Phonepe Transactions, do comment as it will help other members of their query on Will i have to Pay Tax on Paytm Transaction, or will have to pay tax on cashback?
Tax on Paytm and Phonepe Transactions
== As you are rotating your money in your own account linked Phonepe UPI or Tez UPI or Paytm UPI, no income is gained in this process.
== What you are doing is just constantly shifting or rotating YOUR OWN money every time from your own account.
== income tax officials always ignore rotating money things if your all bank accounts linked on same PAN number or Aadhaar number.
== Further, it doesn’t matter if the total rotation transactions cross INR 250,000/- every month or during any period.
== there will be no income tax liability on you. Why? Well, because income tax is a tax on income & you earn just 750+750+300+50+70 = Rs 1920.
== the cashback money (not the entire amount) will be taxable as your income but you earn just few amount Rs 1920 so, no income tax liability on you.
1. Should i have to File an ITR because of My High number of Transactions?
Ans:- Bank Sent your Details to Income Tax when your bank balance reach more than 10 Lakhs or may be transactions. So better to not to File an ITR and manage accordingly.
2. Bank calls me to ask about my Transactions and asking for Explanation on these Transaction. Any issue?
Ans:- No, Tell them what you are doing. Its bank work to verify details with you, Sometime they ask you to open Current account (if you are Self employed and want to continue high number of transactions.). I have received call from ICICI as well as Indusind bank because of huge number of transactions (CryptoCurrency Trading).
any issue Like Income tax on Online Transaction?
These Days, Many of our users ask us about “Any issue with Income Tax of Paytm Transaction, if we do High amount of UPI Transactions !!
- If you are a Student or Self Employed or Both, Then There is No issue (we will explain you “Why no issue for Student/Self employed“). so you don’t have to pay Tax on Paytm Transaction or pay Tax on Phonepe Transaction
First of all, You should understand the meaning of Income Tax – Income Tax means “The Tax” you have pay on your Profit (For Example (Student/Self employed):– If you have 1 Credit transaction worth 5 lakh and 1 debit transaction worth Rs 4 in an Financial year, So you have Made around 1 Lakh Profit? Then You don’t have to Pay any Tax since Your Income is Less than 3 Lakhs.
So in point no.2 we have explained You, Number of transactions doesn’t matter instead Income (Profit) matter for Income Tax, If you have earned more than 3 lakh then you can Calculate Tax on your Total income through Income Tax Calculator
So Everything is Clear for Students and as well as Self Employed (which is majority of our blog). Now we suggest Salary employees to not to Participate in this offer as they are Totally different than us. Below you will get to know if you need to pay tax on cashback?
Do you need to pay tax on cashback?
No you don’t have to pay tax on cashback. In general, credit cards cashback are viewed as discount, not income. So if you’re getting 2% cash back, that would be considered a 2% discount on your purchases. Discounts aren’t taxable, so you don’t need to keep track of your credit card rewards for tax time. However, this is only the case for most credit card issuers, not all.
According to the Internal Revenue Service (IRS), credit card rewards may be taxable as income. The types of rewards and the way in which you receive them determine whether they are considered taxable. In many cases, the rewards are viewed by the IRS as a discount, not as income.
For example, a cash-back program for using your credit card is treated as if it were actually a post-purchase discount. There are some credit card reward programs that offer large sign-up bonuses, which the IRS may end up counting as taxable income.
Tax on Paytm and Phonepe Transactions – Summary
1) Will i have to Pay Tax on Paytm Transaction – No
2) Do you need to pay tax on cashback? – No [Except for Some Cases]
3) Will i have to Pay Tax on Phonepe Transaction – No
Hope now you have got your answer regarding Will i have to Pay Tax on Paytm Transaction? Tax on Paytm and Phonepe Transactions depends on what amount of profit you have earned. So not to worry as doing these online transactions you can only earn upto Rs 500.