Treatment of interest on loans & advances in income tax

This query is : Resolved

Divya Patel (Querist)
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01 February 2017 If a person is having loans & advances and earning interest thereon, then what would be the treatment of interest earned thereon?
can we show it in income side of p&l a/c?
And what would be the effect on loans & advances on assets side?
Is the interest earned be added to the same?
What if some part of loans & advances is received?
How will this effect interest and loans & advances?

ALKESH T MEHTA

ALKESH T MEHTA (Expert)
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01 February 2017 1.Interest on loans & advances can be shown in P&L a/c as other income
2.Interest earned need not be added in loans & advances
3.Only,interest not received will be shown in loans & nadvances