Interest on Capital
This query is : Resolved
05 May 2009
The profit and loss account of a businessman, running a sole proprietorship firm, is debited with interest on capital Rs.5000.Whether it will be allowed as a deduction under the head profits and gains from business or profession?
05 May 2009
No,because one person cannot pay interest to himself.
Manmohan ACA, CS
(Expert)
06 May 2009
No
taxindiaconnect
(Expert)
06 May 2009
NO, Interst on capital is allowed only to partners of a firm in whoes hands this interest is taxable as business Income
06 May 2009
No it's not allowable if it is paid to the proprietor himself. b'cos u can't pay intt to urself.
Rajeev Garg
(Expert)
06 May 2009
agreed
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