Interest on unsecured loans
This query is : Resolved
10 March 2015
Dear Sir,
I am working in a real estate organisation(P.firm). We have taken some unsecured loans. My Question is
1)Is it sufficient, if we take a certificate as they provided the loan as interest free loan or
Is it compulsory to pay interest on that unsecured loan and deduct TDS?
Looking froward for your valuble replies
Thanks in Advance
I am working in a real estate organisation(P.firm). We have taken some unsecured loans. My Question is
1)Is it sufficient, if we take a certificate as they provided the loan as interest free loan or
Is it compulsory to pay interest on that unsecured loan and deduct TDS?
Looking froward for your valuble replies
Thanks in Advance
10 March 2015
Though you can take certificate of no interest loan from them it will be hard to prove if scrutiny comes that you have availed interest free unsecured loan especially if your firm has itself given loan to some persons and is charging interest for that. Moreover a partnership firm is always liable to deduct TDS on interest paid by it whether its accounts are audited or not u/s 44AB if interest paid is in excess of Rs. 5000.
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