Accountancy Forum

I wish to know the law regarding paying cash salary to the employees of
1) sole propritorship
2) AOP
3) ltd companies.

Is there any law giving a particular cut off for cash payment of salary, or we can give cash salary to the employee, no matter what the amount.

Would appreciate an early response.

Dear!

It depends upon the organizational policy of cash disbursement limits, whether its a salary, expense or any other payment. For Example a company has policy of cash payment limit of Rs.10,000/- beyond which a crossed cheque shall be issued.

Regards,

Does it mean that FBR or government has no issues with whomever we make the payment to in any form?
As far as I recall I read once that the cut off for paying cash salary is 15,000. If it was more than that then the payment would have to be by a crossed cheque.

Mr. Omair you are right under section 21 the salary upto Rs. 15,000 can be paid in cash.