Income head for a bike rental side income

719 views 4 replies

Harshit Maloo

8 Points Joined June 2016

I am a regular salaried employee.However I have invested a couple of bikes and use them for rental through a bike rental company X. I am not a part of the company X. I have just given the bikes to them to rent out. The bikes are in the name of the company but we have an agreement stating that I am the owner of the bikes and I have leased the bikes to them. In this case under which head would this income go ? Income from other sources or income from business ? Can I claim depreciation on the bikes ? If my net income is negative from this, can I set it off against my regular salary ? And do I need a firm to claim depreciation ?

Replies (4)

manju

student

39 Points Joined September 2010

Though you are not the registered owner, you are the beneficial owner. If you are earning any income from this business, you are supposed to include this source while filing Income tax return. In case of loss from business, you cannot setoff with salary income.

Mukesh Kumar

Accounts Manager

1466 Points Joined August 2013

INCOME HEAD : INCOME FROM OTHER SOURICES

CAN NOT CLAIM DEPT OF BIKE

THANKS

Kishan Vasantrai Kavadia

Article Assistant

46 Points Joined July 2016

No Depreciation Benefit, being a beneficial Owner You can Show the Rental Income in Income From Other Sources.

You can not reduce your tax on Salary by setting of loss from business or other sources,

Shiwali Shukla

Article

33 Points Joined July 2012

Beneficial ownership is relevant to claim depreciation.You are the lessor of the bikes though the bikes were registered in the name of the company X, you can claim depreciation on these bikes (Refer the Supreme Court judgement in I.C.D.S Ltd. case).You can show it as a business income and claim depreciation on these bikes.But you cannot set off the loss of business with the income of salary.