Assessment of income

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SIR, MY CLIENT IS A PVT LTD COMPANY WHICH PRESENTLY OWNS A HOTEL AND THE INCOME FROM HOTEL OPERATIONS SHOWN UNDER BUSINESS INCOME. NOW THE COMPANY WANTS TO GIVE ON LEASE THE HOTEL TO SOME ONE. NOW THE QUESTION IS IN WHICH HEAD OF INCOME, THE LEASE INCOME IS TO BE SHOWN? PL CLARIFY.

 

IF IT IS UNDER BUSINESS INCOME THERE IS NO ISSUE. IF IT IS HOUSE PROPERTY INCOME, CAN WE WRITE DIRECTORS REMUNERATION IN BOOKS OF ACCOUNTS EVENTHOUGH SUCH REMUNERATION IS NOT DEDUCTIBLE WHILE COMPUTING TAXABLE INCOME. PL CLARIFY.

Replies (2)
U can shown to HP income, No deduction for remuneration is allowed. However u can take standard deduction and interest on loan taken for construction of hotel building. As per books of accounts u first claimed deduction for remuneration and in computation of income disallowed the same

Agree with Mr Sachin Patel, it should be shown as Income from House Property

The assessee is not completely in the Business of Leasing the Assets hence he can consider it as Income From House Property.

If the assessee was in the Business of Leasing the Assets then the leasing of same would be considered as Income From Business

 

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