PAN Rule for Cash Transactions: Large cash movement in a single year? Direct information to Income Tax Department; What exactly is the case

• New Income Tax Bill 2026 released
• New rules for cash transactions
• PAN limit kept at 20 lakhs

PAN Rule for Cash Transactions: After Union Finance Minister Nirmala Sitharaman presented the Budget 2026, the CBDT released the draft of the new income tax rules. These rules suggest significant changes in provisions relating to cash transactions, real estate and vehicle purchases. By highlighting the importance of PAN card in the draft income tax rules, the government aims to make the tax system more transparent and modern.

As per the proposed Income Tax Rules 2026, PAN will now be required for cash deposits or withdrawals of Rs 10 lakh or more in a financial year. Currently, PAN is mandatory for cash deposits of more than Rs 50,000 in a day, but the new rules will be based on the total annual limit. The rule will apply to aggregate transactions between one or more bank accounts, making digital monitoring of large cash flows easier.

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While buying a car or bike worth more than 5 lakhs, the buyer will have to present their PAN number at the showroom. As per the current rules, PAN was not required for bicycles, but for buying a new car, even if the price was Rs 4 lakh, PAN was required. In this new draft, the government has now proposed a uniform limit of Rs 5 lakh for both cars and bicycles.

The limit for granting PAN for purchase, sale, gift or joint development agreement of real estate is being increased from Rs 10 lakh to Rs 20 lakh. The change is expected to bring some relief in paperwork for small property transactions, as PAN will not be required for transactions below Rs 20 lakh. The government is tightening its scrutiny on high-value properties to increase transparency in large real estate transactions.

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Apart from hotel and restaurant bills, payments made for convention centers, banquet halls or event management services will also be closely monitored. Currently, PAN was required for payments above 50,000 for these services, but the draft suggested increasing the requirement to 1 lakh. This change is important for those who spend large amounts of money in cash or other forms for family gatherings or large events.

The new draft rules officially mandate crypto exchanges to share complete customer information with the Income Tax department. A new provision is also proposed to officially recognize Central Bank Digital Currency (CBDC) as a form of electronic payment. Suggestions for increasing the value of various benefits offered to employees by companies are also part of the draft of the new Income Tax Act 2025.