Salary paying rs 52000 in cash

This query is : Resolved

Binod (Querist)
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04 March 2014 Hello all
I am sharing one problem faced by me plz advice me solution
One of Indian company Hire employee from Nepal & Japan and all employee residing india from last 5 month and employer is paying salary all of them rs 52000\month and the thing is that company is paying salary in cash due to none of them have bank account in India Now my question is
1. Whether it is disallowed under section
40A(3) or not
2. How can I manage the same

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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04 March 2014 I assuming your query you paying Rs.52000 salary in cash for 5 employees means not for one employee means for one employee you didn't paying more than Rs.20000 as salary in cash. So section 40A(3) not applicable.

If you didn't paying salary by more than Rs.20000 in cash to a single person per day then section 40A(3) not applicable.

So the said Rs.52000 is for 5 employees and non of them have more than Rs.20000 then section 40A(3) not applicable.

OM SAI SRI SAI JAI JAI SAI

Binod

Binod (Querist)
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05 March 2014 52000 means per month per employee not total sum

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Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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05 March 2014 Then if you paid such salary of Rs.52000 in a single day for one employee then section 40A(3) attracts. If you paid it in different payments and non of the payments exceeds Rs.20000 then 40A(3) not applicable.

OM SAI SRI SAI JAI JAI SAI

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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05 March 2014 However better to open bank accounts for them and pay salary to such bank account.

OM SAI SRI SAI JAI JAI SAI