IT rules eased: Govt allows cash payment of over ₹2 lakh for Covid treatment at hospitals

May 9: In a significant relief to the people, the Central Board of Direct Taxes (CBDT) issued a notification that permitted hospitals, dispensaries, nursing homes, COVID care centres or similar other medical facilities providing COVID-19 treatment to accept cash over and above the limit of Rs 2 lakh for Covid treatment till 31 May, 2021. The notification has been issued under the section 269ST of the Income Tax Act. This section prohibits any person to receive an amount of Rs.2 lakh and above in cash.

“Granting further relief in view of severe Covid pandemic, provisions of section 269ST of  Income-tax Act,1961 relaxed by the Central Govt allows Hospitals/Medical facilities etc. providing Covid treatment to patients to receive cash payments of Rs. 2 lakh or more, ” tweeted Income Tax India.

Relaxation granted for the period 01.04.2021 to 31.05.2021, after obtaining PAN or AADHAAR of patient & the payer.
Notification No.56/2021 in S.O. 1803(E) dt 07.05.2021 issued.(2/2).

— Income Tax India (@IncomeTaxIndia) May 7, 2021

The patient will have to submit Permanent Account Numbers (PAN) or the Aadhaar identification number to avail this benefit. If the patient’s relative or friend is paying for the treatment, then the healthcare facility will have to take note of their relationship.  Income Tax Act doesn’t allow an individual to transact over Rs 2 lakh in cash in a single day. Therefore, the tax department has now provided relief to Covid-19 patients, who need to pay for their medical bills that run into a few lakhs.

The move from the central government has been taken to remove the hardship being faced by relatives and caregivers of COVID-19 patients who visit hospitals for treatment.