Save Rs 499 on a 2-Year Ad-Free CAclubindia Pro Membership. Subscribe Now!

Interest on loan and cash gift

Save Share

This query is : Resolved

BANSI LAL KHURANA (Querist)
Follow

16 August 2013 I HAVE GIVEN A LOAN TO MY EMPLOYER Rs. 3500000/-during 2010-11 and the same had returned back in the same financial year. my employer has not paid any interest to me. i am salary person Assese. NOW Assessing officer -ITO is asking me for add the interest in my total income. my employer is a pvt ltd co.

my question is that can the ITO add the interest in my total income which i have not received. 2nd question is that can i make cash gift to my real brother out of my tax paid income or any limit has for cash gift.

with regards

b.l.khurana

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
Follow

16 August 2013 No the ITO cannot add any interest on notional basis provided the amount which you landed to your employer is out of your own capital. In case you have borrowed funds and have paid the interest which you have claimed as expenditure in account then yes the interest which you have paid shall be added to your income or the interest which you have paid shall be disallowed as expenditure in your account.

You can give gift to your brother but it is better to give the gift by an account payee cheque

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Join CAclubindia WhatsApp Finance Community & stay updated with the latest TAX news, compliance alerts and important updates all in one place!