Taxability under which head
This query is : Resolved
30 August 2016
Guarantor has to repay the loan of principal borrower to prevent his house, kept as mortgage for the loan of principal borrower.
Now guarantor has claimed this amount of loan repayed by him from principal borrower.
Principal borrower has accepted this liability and is paying interest @ 10% on such amount to guarantor.
Moreover, the guarantor repayed the said loan by taking loan from and NBFC @ 12%. And now paying interest to NBFC.
*NET IS THE EXCESS OF 2% of INTEREST PAID TO NBFC OVER INTEREST RECEIVED FROM PRINCIPAL BORROWER*
Now the questions are:
1. Whether this loss of 2% of interest is to be shown under the head INCOME FROM OTHER SOURCES?
2. If not then under which head?
(Guarantor has no income from any source.j
31 August 2016
Loss has to be debited to his capital account.
31 August 2016
loss can NOT be claimed
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