Like to know the applicability of Sec 40A(3) of the incometax Act if Salay is paid Rs21000/-in cash?
11 Replies
CA Saiyum khan
(Practicing CA)
(690 Points)
Replied 30 August 2012
20% of salary amount would be disallowed as per sec. 40A(3).
CA Ram
(CA)
(310 Points)
Replied 30 August 2012
100% salary will be disallowed U/s 40A (3).................
Bharath
(C.A,C.S)
(3983 Points)
Replied 30 August 2012
Section 40A(3) of the income tax act says that if the assessee makes any payment or receipt, expect from cross payee cheque or dd or any banking mode, exceeding Rs. 20000 to a single party is disallowed and treated as the personal expenditure or receipt of the assessee.
but disallowance will not operate if
salary is paid after deducting tax by an employer to an employee, no disallowance operates, after fulfilling such condition.
(a) Such employee is temporarily posted for a continuous period of 15 days or more in a place other than his normal place of duty or on a ship.
(b) He does not maintain any account in any bank at such place or ship.
all other cases fully disallowed.
praveen
(Chartered Accountant)
(6971 Points)
Replied 30 August 2012
| Originally posted by : CA Saiyum khan | ||
 |
20% of salary amount would be disallowed as per sec. 40A(3). |
 |
WASN'T THIS LONG LONG AGO.
Now 100 % is disallowed.
Muthukumar
(Chartered Accountant)
(78 Points)
Replied 30 August 2012
100% of the salary expense will be disallowed if the payment is made to a single person on a single day...
CA Kiran Sutrave
(CA)
(428 Points)
Replied 31 August 2012
100% of the Salary paid will be disallowed
Vaibhav Jandey
(Life iz Hard; I'm Harder)
(1175 Points)
Replied 01 September 2012
The entire amount Rs 21000 is inadmissible in the first instance..
But in some exceptional cases as mentioned above by the user Bharath; it would be admissible.
Tony John
(Chartered Accountant)
(6085 Points)
Replied 01 September 2012
The payment will be fully disallowed as per IT Act.
Akshaydeep Tarachand Dhoot
(Account and Audit Assistant)
(33 Points)
Replied 01 September 2012
100% salary will be disallowed
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