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Disallowance of expenses
Can we paid cash more than 10000 for reimbursement of expenses in a day
can we paid to sundry creditor more than 10000 in a day
Replies (4)
section 40A(3)(a) of the income tax act provides that any expense incurred in respect of which the payment is made in sum exceeding Rs.10,000 in a single day other wise by way of cheque or account transfer is disallowed. This is done with intention to avoid cash transactions and tax evasion.
sir what about receipts from debtors can we accept more than 10000 rs
In the final draft of Finance bill 2017 government has proposed ban on all receipts in cash in excess of Rs.2 lakhs with effect from 1.4.17 under section 269ST. The penalty will be equivalent amount of transaction.
Otherwise also the debtor will become payer from his standpoint it gets disallowed when he makes payment in excess of 10k by way of cash.
10000 is for cash expenses , not for received against cash sales or credit sale
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