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Got salary in cash

Amit Kumar (i want to improve my taxation.) (136 Points)

14 July 2020

for Employee-
if any employee gets salary 30000 Rs. in cash. and he files ITR.
than, is there any problem for employee ???

for Employers-
Employer pays salary 3 time in a month. 10000 Rs. per transaction in cash.

what are the consequences for both Employee and Employers????

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7 Replies

GUDIMETLA VINODKUMAR (123) (11 Points)
Replied 14 July 2020

Total salary exceed 250000 pa ah

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Amit Kumar (i want to improve my taxation.) (136 Points)
Replied 14 July 2020

Yes. and taxable liability will be above 500000 Rs.

GUDIMETLA VINODKUMAR (123) (11 Points)
Replied 14 July 2020

As per sec 40(A) 3
payment exceed per day per person 10000 disallowed
so first case disallowed
second case allowed

RAJA P M ("Do the Right Thing...!!!") (128091 Points)
Replied 14 July 2020

Both case not disallowed as paid salary.

Amit Kumar (i want to improve my taxation.) (136 Points)
Replied 14 July 2020

Thank you for your valuable advice.

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annu Goyal (1102 Points)
Replied 14 July 2020

As employee salary is 360000/- more than basic exemption limit there is Return liablity arises although tax liablity will be nil as rebate under sec 87A is upto12500/- .
and in Hand of employer also there is no disallowance.

mohan sehgal (Chief Executive/Managing Partner) (117 Points)
Replied 15 July 2020

This is an additional query regarding cash payments to Employees ...

During the Complete Lockdown period in the month of April'2020 we paid different amount to our employees in cash selectively/ to meet-out their urgent daily needs/requirement;this was done voluntarily and our employees were graeful about it.

Now,when the work has started,we have put this amount as Labour welfare Expenses/Ex-Gratia payments in our book of accounts.No amount has been deducted or adjusted for or against the working days Salary in the next month payments.The salary paid for the month of April has been as NIL as non-working Period.

Our Query is whether there any liability occurs on our establishment towards ESI/PF obligations.

THANKS......

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