Businesses and traders are required to report any single transaction of cash exceeding Rs 2 lakh for sale of goods and services to the income tax department.
New Delhi: Businesses and traders are required to report any single transaction of cash exceeding Rs 2 lakh for sale of goods and services to the income tax department.
The clarification on the reporting guidelines under Rule 114E of Income Tax Rules, 1962, which came into force from April this year, amid doubts expressed in certain quarters about reporting of cash transactions that aggregate to Rs 2 lakh.
"The norms of aggregation contained in sub-rule 3 of Rule 114E have been amended vide CBDT notification dated October 6, 2016, clearly indicating that the said transactions did not require aggregation and the reporting requirement under SFT for this purpose is on receipt of cash payment exceeding rupees two lakh for sale of goods or services per transaction," the CBDT said in a statement.
Rule 114E of Income-Tax Rules, 1962, for furnishing Statement of Financial Transactions (SFT) came into force with effect from April 1, 2016, under which a person is required to furnish a statement in respect of transaction relating to receipt of cash payment exceeding Rs 2 lakh for sale of goods or service.
With PTI Inputs