Loan taken.

Tax queries 845 views 12 replies

Akansha Mittal

Director

34 Points Joined November 2013

Dear All,

I have taken loan (Rs 55000/-) from my friend and she has deposited the money in my bank. Will this amount (Rs 55000/-) be counted as income.

Looking ahead for support.

Thanks,

Miss Akansha.

Replies (12)

Mihir

Wealth Manager

5293 Points Joined December 2008

Not taxable because it will be returned back to the lender with interest. Prepare a document to record this transaction to be on a safer side.

Piyush Mittal

Article Assistant

63 Points Joined December 2013

No this is not included in income because u have 2 return it..

VIMAL DEVRANI

ACCOUNT OFFICER

126 Points Joined July 2013

No it is not your income because u took the loan on returning basis if possible u keep the documents for safeside.

Rakeshmannara

Article

26 Points Joined November 2009

It will not be considered as income.but since it is credited in your bank account it is better to keep the documents to prove that it is a loan

Rakeshmannara

Article

26 Points Joined November 2009

It will not be considered as income.but since it is credited in your bank account it is better to keep the documents to prove that it is a loan

Ajay S

56 Points Joined December 2010

you can face penalty by accepting cash loan refer section 269ss of income tax. The penalty is equal to loan amount accepted.

Akansha Mittal

Director

34 Points Joined November 2013

Dear All,

Thankyou for your reply.

Some replied that cash can be accepted but some replied that cash cannot be accepted. I have bben through section 269ss and it states that cash canot be accepted.

But now I have accepted, so please let me know what to do.

Thanks,

Akansha.

praveen

Chartered Accountant

6971 Points Joined September 2007

Loan in cash cannot be accepted.However if it goes through the banking channel you need not worry. for more information visit capraveenmr.wordpress.com

kanika jain

none

36 Points Joined February 2014

No as per section 269 ss ... cash loan more than 20000 cannot be accepted

Akansha Mittal

Director

34 Points Joined November 2013

Dear All,

Thank you for your reply.

As per section 269ss, while taking loan from friend / relative, we cannot accept cash. It has to be through either by account payee cheque or account payee bank draft.

My query is:

a. That can we accept loan through internet bank transfer.

b. How to do documentation of loan taken from friend / relative.

Thanks,

Miss Akansha.

It will be considered as income bcoz the condition of sec 269ss not satisfied but if u will satisfies the condition u/s 269 t I.e. payment of loan by account payee cheque along with the interest then it will not b consider as income. And such payment shall be deemed as evidence.

Guest

Hi Akansha,

There is no clarity about internet transfer of loan amount so its better to take a conservative view. About documentation, a simple letter mentioning the date,amount, terms of repayment would be enough.

In my view you should offer the loan to tax as income from other sources at normal rates (eg gift from friend>50000). This is because if it is shown as cash loan, the penalty is 100% and if it is classified u/s 68, the tax is flat 30%