Dear Sir
in our case one proprietory firm to meet its financial problems accept loan from one of its employee (manager) by a/c payee cheque Rs.600000 and agrees to pay interest @ 10% is any legal problem in that
Sowmya.S.Balan (Paid Assistant) (749 Points)
20 December 2013Dear Sir
in our case one proprietory firm to meet its financial problems accept loan from one of its employee (manager) by a/c payee cheque Rs.600000 and agrees to pay interest @ 10% is any legal problem in that
Since you are a proprietory concern you will the taxed as an individual.
If your turnover is exceeding 1 cr (If business) / 25L(profession), then you should deduct tax at source @ 10% when you pay interest to the employee( He should furnish PAN)
Also make sure that the repayments of the loan are by A/c payee cheques too.
Dhruvi N suthar
(Account Executive)
(303 Points)
Replied 21 December 2013
Agreed with Madhavi Pandit
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