Cash payments
This query is : Resolved
pvsrikanth
(Querist)
30 July 2011
DEAR SIR,
WHY CAN'T WE MAKE CASH PAYMENTS ABOVE 20,000. IS THIS RULE ? WHICH DEPART ISSUE THIS NOTICE.
WHY CAN'T WE MAKE CASH PAYMENTS ABOVE 20,000. IS THIS RULE ? WHICH DEPART ISSUE THIS NOTICE.
CMA Ramesh Krishnan
(Expert)
30 July 2011
As per Income tax section 40A(3) if the payment made by case more than Rs.20000 the particular expenses will be disallowed and it can be claim in the income tax.
If one expenses cannot claim under Income tax your profit will be increase and your tax liability also will go up, indirectly you are paying more tax for making cash payment more then Rs.20000
If one expenses cannot claim under Income tax your profit will be increase and your tax liability also will go up, indirectly you are paying more tax for making cash payment more then Rs.20000
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