Credit cards cash withdrawals

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This discussion addresses how to report cash withdrawals made from a credit card and deposited into a savings account for income tax returns. It clarifies that the withdrawal itself isn't income and should be treated as a loan or contra entry. Expenses paid from this cash should be accounted for as per bills if used for business. The deposit into a savings account is not considered taxable income.

Ca Neha Jain

Ca Neha Jain (Querist)
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29 July 2020 A client withdraws cash from his credit card and deposits this in his savings account. Uses this amount to meet personal expenses and also credit cards payments.

How to report this transaction in income tax returns? Will the deposit in savings account be taxed?

RAJA P M

RAJA P M (Expert)
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29 July 2020 NO... NO MORE TAXABLE. IT WILL ACCOUNT IN WITHDRAWAL ACCOUNT IN CASE SHOWN IN HIS TRANSACTIONS.
BOOK THE EXPENSES AS PER BILLS IN CASE USED TO BUSINESS ACCOUNT...

Ca Neha Jain

Ca Neha Jain (Querist)
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29 July 2020 He has deposited the cash in savings account. Where and how to report it in income?

RAJA P M

RAJA P M (Expert)
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29 July 2020 It's not a income... In case he withdraw cash as loan then can be shown as loan

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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14 October 2021 It would be just contra entries,
credit card cr.
Cash Dr.

while depositing it to sav acc.
Sav acc Dr.
Cash Cr.

where there is any income to declare it in ITR??

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