Dear Sir / Madam,
Shall we make Salary payment as Cash ₹ 15,000/-
If not how much we can Make?
Because employees/Labours are getting cash Advance Daily and weekly basis
For Example: An Employee/Labour drawing a salary of ₹ 15000/-, taken cash Advance of ₹ 6,000/- and then remaining is paid in bank account at the end of the month, is this acceptable
Paying Employees Over 10,000 in Cash Violates Section 40A(3); Split Cash and Bank Payments Are Legal. A query was raised regarding the legality of paying employees a salary of 15,000 in cash. It was clarified that according to Section 40A(3) of the Income Tax Act, cash payments exceeding 10,000 are not permissible. However, the arrangement of providing a 6,000 cash advance and paying the remaining amount through a bank account is acceptable and complies with the legal requirements. This approach ensures adherence to the prescribed cash transaction limits, allowing for the deduction of expenses. (AI Summary)
TaxTMI 
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TaxTMI 
