Tax liability on lending money to friend

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28 Points Posted on 04 February 2011

Hi,

I have to lend more than Rs. 10L to my friend. I want clear documents so that there is no tax/legal problems later. What paper work is required? and What details should be included in the document? Is there any available sample document?

If I get any interest, what will be the tax liability? 

Many many Thanks

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On 04 February 2011 at 14:36 Report
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Learner
3134 Points Posted on 04 February 2011

 

You can prepare and agreement on stamp papers about loans & interest and what percent interest have to charge. Only interest will be chargeable to tax which you will recd.

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On 04 February 2011 at 15:00
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28 Points Posted on 04 February 2011

Thanks Pankaj Ji.

Can I find a sample loan agreement on internet?

Thanks a lot.

Puneet

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On 04 February 2011 at 15:16
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Learner
3134 Points Posted on 04 February 2011

 

Yes you can search on google.

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On 04 February 2011 at 15:21

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