Big transection within self account

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A trader is concerned about the tax implications of frequently transferring large sums (10 lacs weekly) between their savings and broking accounts, amounting to over £5 crore annually. They are seeking advice on how to avoid scrutiny from the income tax department and ensure their transactions appear legitimate. The consensus is that as long as the funds have a valid source and no cash is involved, the transactions are legal. It's recommended to use a separate savings account linked to the brokerage account for these transfers to simplify explanations if needed.

Kumar Thakkar

Kumar Thakkar (Querist)
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04 March 2022 I'm a trader and I have to transfer big amount from my broking account to savings account and now with increasing earning the amount is getting bigger.

So I have "10 lacs" fund and I need it that full amount for 2 days only so transfer it from my savings account to my broking account and other 5 days of week I don't need it so want to transfer back to savings account to earn intrest on that sum.

So basically I have to move it from my "one income source" to "second income source" Evey week.

10 lac ×52 week = 5.20 crores transection would be yearly in my accounts.

So "what should I do to avoid income tax department notice or any doubts on me?"

As I'm doing it only in my account (or sometime my family members account) and it's my only income source.

Should I clarify them in advance and how?

Or what should I change to look it 100% legit

Or it is okay and legally correct what I'm doing?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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05 March 2022 No question of clarification in advance, as that option is not available.
It is better not to involve your other member;s accounts.
Better open a separate savings account linked with the brokerage account, and do such transactions only from that account, so that in case of inquiry the explanation can be easy.

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Kumar Thakkar

Kumar Thakkar (Querist)
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05 March 2022 Thank you so much sir for your response🙏

From now I will only use only one seprate Saving account for all these transactions as per your suggestion.

One doubt I have ,
Is there any chance of IT notice because of such "huge" transection?

Because I don't know whether it is legal as per law?

And What should I do to explain this as legal transection.

Although I am filing my IT return since 3 years for 3 lacs/year and ,
the other part of fund fund is sourced with my parents fund for which also IT return is filed already