Is Provision Allowable expense
This query is : Resolved
09 April 2008
Hi,
Friends & Respected Experts.
Is Provision for I.Tax & Provision for Bad & Doubtful Debts allowable expense?
If yes then under what section?
Friends & Respected Experts.
Is Provision for I.Tax & Provision for Bad & Doubtful Debts allowable expense?
If yes then under what section?
09 April 2008
Provision is not allowed as deduction
10 April 2008
NO PROVISION OF INCOME TAX OR BAD AND DOUBTFUL DEBTS IS ALLOWED AS DEDUCTIBLE EXP FOR IT PURPOSE.
IN SUPPORT OF THE ABOVE , I QUOTE below CLAUSE( vii) of sub section 1 of section 36 (under other deductions allowed for business ) OF INCOME TAX ACT WHICH SAYS THAT the amount of (any bad debt or part thereof which is written off as irrevocable in the accounts of the assesseee for the previous year.
so only those amounts written off as bad debts but not provision for bad debt is allowed as deductible under IT act.
R.V.RAO
IN SUPPORT OF THE ABOVE , I QUOTE below CLAUSE( vii) of sub section 1 of section 36 (under other deductions allowed for business ) OF INCOME TAX ACT WHICH SAYS THAT the amount of (any bad debt or part thereof which is written off as irrevocable in the accounts of the assesseee for the previous year.
so only those amounts written off as bad debts but not provision for bad debt is allowed as deductible under IT act.
R.V.RAO
10 April 2008
Provision for Bad & Doubtful Debts is allowable but Bad & Doubtful Debts is allowable deduction for tax computation of business.
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