Foreign exchange loss
This query is : Resolved
26 May 2015
What should be the treatment of foreign exchange loss on long term loans taken (not for acquiring asset) .
and is this loss allowed as expenses in income tax act
and is this loss allowed as expenses in income tax act
26 May 2015
Charge off the loss to P&L account.
Foreign Exchange Fluctuations on Revenue Account means on debtors of export, creditors for expenses payable abroad, then the foreign exchange fluctuations gains shall be taxable under the head of Profits and Gains of business or profession.
Similarly, the foreign exchange fluctuations loss is deductible under section 37(1) while computing the income under the head “Profits and Gains of business or profession”.
These foreign exchange fluctuations shall be taxable/deductible on accrual basis if the assessee is following accrual system of accounting.
Foreign Exchange Fluctuations on Revenue Account means on debtors of export, creditors for expenses payable abroad, then the foreign exchange fluctuations gains shall be taxable under the head of Profits and Gains of business or profession.
Similarly, the foreign exchange fluctuations loss is deductible under section 37(1) while computing the income under the head “Profits and Gains of business or profession”.
These foreign exchange fluctuations shall be taxable/deductible on accrual basis if the assessee is following accrual system of accounting.
26 May 2015
its debit to profit & loss a/c
26 May 2015
YOU HAVE TO DEBIT PROFIT & LOSS A/C
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