Readers' Corner: Taxation

Kuldip Kumar, partner and leader, Personal Tax, PwC India, answers your questions

Kuldip Kumar 

To help a friend who was travelling, I took a cash payment of Rs 2.5 lakh from his client and deposited in my bank account. Later, I transferred it to him via net banking. If I get a query from the tax department, asking to explain the source of funds, what should I do?   You are rightly worried as the tax authorities may suspect this to be the case of money laundering. There are several aspects to this transaction  which can be questioned and needed to be explained. First of all, why did you receive this cash? What is the nature of receipt? Whether  money taken from the ...

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Readers' Corner: Taxation

Kuldip Kumar, partner and leader, Personal Tax, PwC India, answers your questions

Kuldip Kumar, partner and leader, Personal Tax, PwC India, answers your questions To help a friend who was travelling, I took a cash payment of Rs 2.5 lakh from his client and deposited in my bank account. Later, I transferred it to him via net banking. If I get a query from the tax department, asking to explain the source of funds, what should I do?   You are rightly worried as the tax authorities may suspect this to be the case of money laundering. There are several aspects to this transaction  which can be questioned and needed to be explained. First of all, why did you receive this cash? What is the nature of receipt? Whether  money taken from the ... image
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