Is it illegal to pay someone cash in hand?

Is it illegal to pay someone cash in hand?

It is legal to be paid in cash

The fight against fraud is something that concerns us all, so we must be well informed of the current regulations to avoid problems. Do you know what the new limitation on cash payments is? Do you know that you can be denounced for not complying with it, even the person to whom you make the payment or collection?

Note that the limitation applies to the transaction, not to the cash payment itself. That is to say, if we have to pay a transaction of 1,100 euros and we pay in cash 200, we would be in breach of the rule.

You must take into account that both the payer and the person who receives the amount in cash are considered offenders, and they are jointly and severally liable for the penalty that may occur, which will be 25% of the amount paid in cash of the transaction that exceeds the amount of 1,000 euros.

In the event that one of the parties, within three months after the payment, denounces before the State Agency of the Tax Administration the operation carried out, its amount and the identity of the other intervening party, the denouncer will be exonerated of responsibility.

Cash payment certificate

Banks established in non-eurozone EU countries must also apply this rule: they cannot charge more for a payment in euros to or within an EU country than they charge for a domestic payment in the country’s currency.

Read more  How much do MyTutor tutors get paid?

Upon returning from his vacation, Jakub has to make a transfer of 150 euros to a friend’s account in France. His bank can only charge him the same amount that applies for a Czech koruna transfer made within the Czech Republic (CZK 5) or its equivalent in euros.

In the EU, when paying by credit or debit card, merchants and banks cannot charge you fees (“surcharges”) just for using a certain card. The rule applies to all purchases (both in stores and online) you make with a card, whether in your own country or in another EU country.

EU rules on payment services do not apply to credit and debit cards issued by three-party systems (such as American Express or Diners Club), or to company or “corporate” cards (where the company pays): you may have to pay a fee for using them.

Payment of payroll in cash

You must take into account that both the payer and the person who receives the amount in cash are considered offenders, and they are jointly and severally liable for the penalty that may occur, which will be 25% of the amount paid in cash of the operation that exceeds the amount of 1,000 euros.

In the event that one of the parties, within three months after the payment, reports to the State Tax Administration Agency the transaction carried out, its amount and the identity of the other party involved, the complainant will be exonerated from liability.

Recently, the Ministry of Finance has proposed to modify this limit, lowering the maximum limit for cash payments made by professionals from 2,500 to 1,000 euros, and the regulations that would regulate the lowering of this limit are pending approval.

Read more  Is personal independence a payment?

The collection or payment in cash above the current limit of 2,500 euros entails penalties. The prohibition is independent of whether or not an invoice is issued, and non-compliance is punishable by a fine of 25% of the amount paid, which means that the minimum penalty is 625 euros. This penalty has a joint and several nature, so that both the payer and the receiver of the money will be liable for it, and the Tax Authorities may demand it from both.

Payroll payment by bank transfer

The Directive establishes the following criminal offenses when committed intentionally:The Directive also establishes the conditions for legal persons (an entity with legal personality) to be held liable for offenses, and equates penalties for natural and legal persons.

Directive (EU) 2019/713 of the European Parliament and of the Council of 17 April 2019 on combating fraud and counterfeiting of non-cash means of payment and replacing Council Framework Decision 2001/413/JHA (OJ L 123, 10.5.2019, pp. 18-29).

Read more  Is the account number the same as the credit card number?