Loan to Father for business purpose

Mudassar Nath (Manager) (41 Points)

26 May 2023  

Hello Friends,

I have borrowed loan from my bank and lended it to my Father for business purpose. Bank will charge interest to me and reciprocally I will collect it from my father. My father will deposit installment (principal + interest) amount in my account to settle the loan.

In this scenario, what will be income tax implication (if any) and can my father claim interest payment as business expense.