The Reserve Bank of India (RBI) has announced a significant proposal to increase the Unified Payments Interface (UPI) limit for tax payments from ₹1 lakh to ₹5 lakh. This proposed hike aims to streamline the process for taxpayers, allowing them to settle higher tax dues directly through UPI.
The move is expected to benefit many taxpayers, as UPI transactions generally do not incur additional charges unlike payments made via debit or credit cards. This shift could substantially reduce the overall cost of tax payments, making UPI a more economical choice for settling dues.
This proposal builds on a similar adjustment made in December 2023, when the limit for payments to hospitals and educational institutions was also raised to ₹5 lakh. The RBI’s latest proposal reflects its ongoing efforts to enhance the convenience and cost-effectiveness of digital payments for Indian taxpayers.