In order to stop tax avoidance, the income tax department will be watching cash transactions in hospitals, banquet halls, and companies.
Let’s dive into the details of the Income Tax Department’s Tax evasion against cash transactions limits:
According to the income tax authorities, such transactions must only be carried out through banking channels and it is illegal to receive cash payments of Rs 20,000 or more in exchange for a loan or deposit. A person is also prohibited from receiving from another person a total of Rs 2 lakh or more in cash. Additionally, cash contributions made to a registered trust or political party cannot be deducted by taxpayers.
The department keeps an eye on cash transactions at certain businesses and institutions, including hospitals. Health facilities have broken the law requiring them to collect patients’ PAN cards when they are hospitalized, department officials have verified.
The income tax division is currently preparing to take action against these hospitals. The department intends to track patients who have paid significant sums of money to private medical institutions using the data from health service providers.
To find any inconsistency in the filed returns, the tax department uses specific data, such as the Annual Information Statement.