19 Say No To Cash Transaction
19 Say No To Cash Transaction
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1. Taking or Accepting
Certain Loans, Deposits
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No person is permitted to accept Rs. 20,000 or
morein cash
a) foranyloan ordepositor
b) any amount in relation to transfer of any
immovable property (even if transfer does
nottake place).
If any cash received from a person for any such
purpose s still outstanding to be repaid, then the
overall limit of Rs. 20,000/- will apply to the
outstanding amount plus any subsequent receipt
in cash.
The exceptions to this provision include the
following:-
Sums of this nature accepted from
(a) Government;
(b) any banking company, post office savings
bank or co-operative bank;
() any corporation established by a central,
state or provincial Act;
(d) any Government company as defined in
clause (45) of section 2 of the Companies
Act, 2013;
(e) such other institution, association or body or
class of institutions, associations or bodies
which the Central Government may, by
notification in the Official Gazette, specify.
(f) from a person having agriculture income,
and the recipient is also having agriculture
income and neither of them is chargeable to
income tax.
Consequences of violation: Penalty of an amount
equal to the amount taken in cash will be levied.
2. Repayment of Certain
Loans or Deposits
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In case a person incurs any expenditure for his
business or profession, in respect of which
payment or aggregate of payments made in cash
in a day exceeds Rs. 10,000/, 100% of such
payment will be disallowed while computing his
taxable income from business/ profession.
(Refer Section 40A(3)). However some
exceptions are provided (See Rule 6DD of the
Income Tax Rules).
5. Deemed Income of
Subsequent year in
which payment is made
6. Disallowance in respect
of Fixed Assets i.e.
Capital Expenditure
- -
In case a person incurs any expenditure for
acquisition of any asset in respect which a
payment or aggregate of payments made to a
person in cash in a day exceeds Rs.10,000/-, such
expenditure is not included for the purposes of
determination of actual cost of such asset. This
means that no depreciation benefit will be
available on such capital expenditure incurred in
cash.
7. Cash Donations
8. Premium on
Health Insurance
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Any payment made in cash on account of
premium on health insurance facilities is not
allowable as deduction u/s 80D of IT Act.
DECEMBER 2019