Payment compliance via electronic clearing systems tightens non-deduction rules for business expenses, restricting cash payments beyond the permitted threshold. Amendments to section 40A modify the non-deduction rule by requiring payments to be made by account payee cheque, account payee bank draft or use of ... Summary
Payment compliance via electronic clearing systems tightens non-deduction rules for business expenses, restricting cash payments beyond the permitted threshold.
Amendments to section 40A modify the non-deduction rule by requiring payments to be made by account payee cheque, account payee bank draft or use of electronic clearing system through a bank account; they lower the cash-payment threshold and make consequential changes to sub-sections (3A) and (4), and add a proviso clarification to sub-section (2). The changes take effect from 1st April, 2018 and apply to the relevant assessment year and subsequent years.
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