If I were to take 10 lac rupees loan from ten individuals for business purpose and promise then to pay a certain rate of interest, how do I go about reporting it to the tax authorities so that they don't ask me to pay tax on the principal amount but just on the profit that I earn after paying the interest amount?
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Loan and tax reporting t
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Nature of assesse.????
Even in a normal way, the Department is not asking to pay tax on taking loans from others. you need to create their ledgers under loans & liability. You may show interest as an expense on your books.
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