Interest free loan to employee

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

07 April 2016 Hello seniors,
Our company has given interest
Free loan Rs. 2 lakh to one of the employee...1) weather interest free loan
wi cover the section 269SS or not...2)
Can we consider the relief u/s 89(1)
or not while deducting TDS,

Regard
Amit Chhabra

KAVIRAJA ADDANGADI

KAVIRAJA ADDANGADI (Expert)
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07 April 2016 Interest free loan given by company not covered u/s 269SS.
2.no relief AVILABLE u/s89(1)
3 . interest free loan taxable considered has perquisitte in the hands of employee. Small loan upto Rs.20000/- is exempt.

Interest Calculated at the rate charged by SBI, as on 1st day of previous year calculated on maximum outstanding monthly balance.

Querist : Anonymous

Querist : Anonymous (Querist)

07 April 2016 Sir. What do you means by interest calculated at the rate charged by sbi as on first days of previous year calculated on maximum outstanding monthly balance...

KAVIRAJA ADDANGADI

KAVIRAJA ADDANGADI (Expert)
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07 April 2016 Normal interest worked out basis of SBI, amount of. Interest Calculated accordingly. Same will be considered taxable perquisite.

Querist : Anonymous

Querist : Anonymous (Querist)

07 April 2016 Sir can A employes not provide the interest free loan to its employee ....

Murtaza I Bhagat

Murtaza I Bhagat (Expert)
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07 April 2016 Yes he can but Kaviraja sir has explained as A employer can provide interest free loan to their employee but they have to count this loan as perquisite in form 12BA and calculate interest as rate taken by SBI as a taxable side while preparing computation and Form 16. am I right kaviraja sir ??

Querist : Anonymous

Querist : Anonymous (Querist)

07 April 2016 How much % sbi interest will be consider to
calculate the taxability...also let me know the
loan was given 4/4/2016 how the interest will
be calculated....

KAVIRAJA ADDANGADI

KAVIRAJA ADDANGADI (Expert)
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07 April 2016 Yes, you are right Regarding interest free loan.

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