Government lifts cash payment limit for Covid-19 treatment

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On Friday, the government authorized cash payment in excess of Rs 2 lakh in hospitals and nursing homes treating Covid-19 patients.

The Ministry of Finance has relaxed income tax rules, which prohibits payment in cash in excess of Rs 2 lakh to any entity.

The relaxation was granted for the period from April 1 to May 31. Both patient and recipient will need to submit their PAN or Aadhar card number to the hospital for such payment.

The move came after the Delhi High Court requested the Center’s response to a plea claiming hospitals were delaying treatment and refusing to accept money beyond Rs 2 lakh citing the tax law on income.

Read | Third wave of Covid-19 can be avoided if necessary measures are taken, Center says

“The central government …. hereby specifies hospitals, clinics, nursing homes, Covid care centers or other similar medical establishments providing Covid treatment to patients for the purposes of Section 269ST of the Income Tax Act 1961 for payment received in cash during From April 1, 2021 to May 31, 2021, on obtaining the PAN or AADHAAR of the patient and the beneficiary and the relationship between the patient and the beneficiary … “, said the CBDT.

Nangia & Co LLP partner Shailesh Kumar said in the current situation various hospitals / nursing homes have demanded cash payment for Covid treatment.

“In view of the extraordinary pandemic situation, where saving people’s lives is the most important, given the real hardship of people, the government has issued a current notification allowing people to make cash payment for COVID treatment , even beyond this limit.

“The notification applies to all cash payments made from April 1, 2021 to May 31, 2021,” Kumar added.

(With PTI inputs)


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