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Rental Expenses (Commercial Loan against Property)

16 September 2020

Hi Experts

One of our Pvt Ltd Company buy a commercial Property through Loan. and same land Given for Rent to other Partnership firm

my question is Pvt Ltd Company property loan interest portion is clime as business expenses in the books of Pvt Ltd Company

Note : Pvt Ltd Company business is manufacturing of precision tools

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2 Replies

abhay garg (Senior auditor) (110 Points)
Replied 16 September 2020

You have 2 Option
1. You Can Claim the interest as Business Expenditure in the Books Of Account.
2. You can Show the rental Income under the head of Hosue Property and Claim the Interest as a deduction

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Sagar Patel (Tax and Business Consultant) (11611 Points)
Replied 17 September 2020

As per my View
You can Show the rental Income under the head of Hosue Property and Claim the Interest as a deduction under Section 24 as renting is not your business. This is also better for you as you also get standard 30% Deduction from your rent income.