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Employee salary FY 2021-22

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Sandeep Jain

Pivate

1492 Points Posted on 22 February 2022

Sir,

Employee salary is Rs.16000/- Per month From April to January Rs.160000/_ we have Paid Rs.100000/_ in cash Rs.10000/- In each month from April to January. Rs.25000/- we have paid via Google pay.so can we pay balance Rs.35000 By Cash it is allowed.

Replies (4)

Quick Summary

This discussion clarifies the rules around paying employee salaries in cash for the financial year 2021-22. While paying the remaining balance of Rs. 35,000 in cash is permissible, it will prevent you from claiming a deduction under Income Tax. The Income Tax limit for cash payments is Rs. 10,000 per month, making online payments via methods like Google Pay advisable for the full amount to ensure tax deductibility.

CA Ankith Jain

Chartered Accountant

973 Points Posted on 22 February 2022

You can pay, but you not be able to claim deduction under Income tax. As per Income tax, limit is Rs.10,000. So its better if you can pay balance via gpay itself.