Petty cash

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Navin M Patel (Querist)
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08 November 2011 Dear all,

My company wants to transfer (by chq.) petty cash of 1,00,000/- in my salary account. Does the said petty cash amount considered as my income? I am filing my Income Tax return in Form ITR-4 how can I maintain my company's petty cash account in my book? Give me advise how will the said amount received from my company?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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08 November 2011 In case the amount of Rs. 100000/-is treated by the Company as a petty amount, then it is certainly in a position to open its own Bank A/c in which the said amount can be transferred and can be withdrawn by you directly from that bank account in cash.
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In Petty-Cash amount is transferred as and when required. In case 100000/- is transferred four or five times in a year, then the petty amount may convert into big tax liability for you, when you would not be able to explain the expenditures.
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You can not maintain other assessee's petty cash books in your books.
However, you may maintain a Separate Cash Book for it.
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CA Prashant Gupta

CA Prashant Gupta (Expert)
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08 November 2011 why they want to do so?
it is not a good practice.
defiantly it will effect your account. How you will able to convince ITO for this?
as per my opinion you can't maintain company's cash in your account.

O.D.SHARMA

O.D.SHARMA (Expert)
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08 November 2011 Hi,use self cheques for a fixed amount to withdraw on behalf of company & keep petty cash book.twice or once a week adjust by Vr to main cash.

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