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Credit Card Amount use for business Capital

Tax queries 525 views 2 replies

We have a partnership company of 3 Partners. I have used my credit card to transfer 1.5 Lakhs from my credit card to our business current account every month and repaid it on due date from business current account. We used this 1.5 Lakhs for business rotation. 

 

Now 18 Lakhs is showing in my Personal Annual Information Return (AIR). cumulative 18 Lakhs is paid directly from my card to business current account and repaid directly from current to my credit card

We are yet to file ITR for my personal and our business..

Kindly provide your inputs on this regard

Replies (2)

The 1.5 Lakhs transferred from your credit card to the business account should ideally be treated as a business expense, assuming it was used for business purposes. Make sure you have records of how this money was utilized in the business.

Given the significant amount involved, it's advisable to consult with a tax professional or accountant who can help you properly account for these transactions in your personal and business tax returns. They can advise you on how to address the 18 Lakhs shown in your Personal Annual Information Return (AIR) and ensure compliance with tax regulations.

Clearly it's capital introduced by the Partner to the Partnership Firm and also withdrawn from the partnership firm by the Partner. Account it accordingly. Whats reflecting in your AIR/AIS can be explained and justified. Not to worry

Rgds
CA. Raj Doshi
R C D & Co.
Chartered Accountants


CCI Pro

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