The Reserve Bank of India (RBI) announced on Thursday that the UPI ceiling for tax payments has been increased from Rs 1 lakh to Rs 5 lakh per transaction. This would make it easier for taxpayers with significant tax liabilities to pay their bills quickly and hassle-free.
RBI Governor Shaktikanta Das announced the outcome of the three-day Monetary Policy Committee (MPC) meeting, saying UPI transfers can be done up to Rs 5 lakh from the current Rs 1 lakh for tax payment purposes.
"Due to its seamless characteristics, UPI has emerged as the most popular payment method. The current transaction limit for UPI is ₹1 lakh. Based on the numerous use cases, the Reserve Bank has periodically evaluated and increased the limitations for a few categories such as capital markets, IPO subscriptions, loan collections, insurance, medical and educational services, and so on. The maximum for direct and indirect tax payments using UPI has been increased from ₹1 lakh to ₹5 lakh per transaction due to their increasing frequency and volume. Governor Das indicated that necessary instructions would be issued separately.
However, the general transaction limit is Rs 1 lakh.
The NCPI FAQ states that the transaction limit for regular UPI is Rs 1 lakh per transaction. The transaction limit in UPI is up to 2 lakh for a few particular kinds of transactions such as Capital Markets, Collections, Insurance, and Foreign Inward Remittances, and up to Rs 5 lakh per transaction for Initial Public Offerings and Retail Direct Schemes.
