Can Cash payments exceeding Rs.20,000 be made to employees as advance??
sivaram
(Asst Mgr-Taxation)
(6918 Points)
Replied 22 November 2011
40A(3) of Income Tax Act says any payment made in excess of 20000/= to any person .so you cannot make advance to an employee for Rs20000/= in cash on a single day
ashish gupta
( student)
(1922 Points)
Replied 22 November 2011
I think payment as advance can be given in cash for more than 20000 as you are not claiming it as your expenditure
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