Sec. 40A(3)
This query is : Resolved
25 November 2009
Will Sec. 40A(3)be applicable on advance payment of salary more than Rs.20,000 in cash?
25 November 2009
yes
25 November 2009
Sec. 40A(3) says: If an assessee incurs any expenditure in respect of which payment in excess of Rs. 20000 is made otherwise than a crossed cheque or crossed demand draft then such expenditure is disallowed.
Even though advance salary is not an expenditure at present since it is charged to P&L on future date it is advisable not to pay in cash.
Even though advance salary is not an expenditure at present since it is charged to P&L on future date it is advisable not to pay in cash.
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