Clause 23- Section 40A(2b)

Clause 23-Section 40A(2b)

The system captures the details in the following steps:  

What is it ? 

1-Section 40A(2) of the Income Tax Act allows an Assessing Income Tax Officer to disallow an individual or an entity to claim expenses as deductions. 
2-Section 40A(2) of the Income Tax Act is applicable when the transaction meets the following three objectives:
(a) The payment is an expenditure of any type.
(b) The payment is made or to be made to "specified persons" as mentioned in the Income Tax Act.
(c) The expenses are made or to be made above the fair market value of the services, goods or facility in question.

1. The user can “Add” any party as related party by adding the ledger name and describing the nature of relationship. 
2. Any number of ledgers can be added as a related party a required by the business. 

1. Once added any voucher pertaining to the related party is displayed on the screen and the user can submit the details on the screen to complete filling in details under this clause. 
2. The “ Name of related person” field can accept any ledger from the list of ledgers added into the system.