Business expenditure paid to one person in one day above ₹10,000 through non-prescribed modes is generally disallowed.
Business expenditure paid to one person in one day above ₹10,000 through non-prescribed modes is generally disallowed. The limit is ₹35,000 for payments for plying, hiring or leasing goods carriages, subject to Rule 6DD exceptions.
Splitting invoices does not help if payments to the same person in a day cross the limit. A later cash payment of an earlier allowed liability can become taxable.
Aggregate payee-day payments; classify mode; test goods-carriage threshold; document Rule 6DD exception; reverse disallowance or later income.
Three cash payments of ₹4,000 to one supplier on one day total ₹12,000 and trigger the rule unless an exception applies.
The example is an illustration, not a substitute for the taxpayer's facts. A change in status, period, payment mode, document, city, asset, relationship or scheme can change the result.
Search pages often state a rate or limit without identifying the governing base. The calculation must distinguish gross receipt from taxable profit, tax from TDS, a deduction from an exemption, salary from business income, and an accounting entry from the tax treatment.
| Decision point | Required treatment |
|---|---|
| Legal year | Use the Act, rules and notification effective for the income or transaction period |
| Taxpayer category | Confirm residence, age, entity, employee/business status and regime |
| Calculation base | Use the statutory definition rather than CTC, net bank receipt or accounting label |
| Ceiling or rate | Apply actual-amount, percentage, shared, lifetime and gross-income limits in sequence |
| Documentation | Link every input to an invoice, statement, contract, certificate or official record |
| Final output | Show tax, surcharge, cess, interest and TDS/TCS credits separately |
This page is written around the entities and concepts search engines expect for the topic: business deduction, depreciation, section 33, section 37, cash payment. They are used only where relevant and are connected to the live calculator and knowledge hub rather than repeated mechanically.
For the complete rules on this topic, see the core guide: Business Income Tax Calculator India 2026: Profit-to-Tax Workflow.
See the broader Income-tax Act 2025 study guide hub for related rules and calculators on this topic.
Business expenditure paid to one person in one day above ₹10,000 through non-prescribed modes is generally disallowed. The limit is ₹35,000 for payments for plying, hiring or leasing goods carriages, subject to Rule 6DD exceptions.
Finin2min rule: establish eligibility, calculate transparently, and preserve an audit trail.
Use the current official instrument, portal or regulator publication before acting. This panel separates the category authority from page-specific references.