Dear sir,
I am a Lic agent, I take a car in bank finance
My question is
1. Can I claim depreciation as expenses?
2. Can I claim Interest on the Loan as expenses?
Musrath Shaik
(175 Points)
Replied 22 July 2023
As a LIC agent who has taken a car on bank finance, you may be eligible to claim depreciation and interest on the loan as expenses, subject to certain conditions. Here's a more detailed explanation:
Claiming Depreciation as Expenses: Yes, you can claim depreciation on the car as an expense if you are using the car for your LIC agency business. Depreciation is the wear and tear of the car over time, and it is allowed as a deduction to account for the reduction in the car's value due to its use in the business. The specific rules and rates for calculating depreciation vary by country, so you should consult the tax laws applicable in your country to determine the exact depreciation rates and rules.
Claiming Interest on the Loan as Expenses: Similarly, you can claim the interest on the car loan as an expense if the car is used for business purposes. The interest paid on the loan is considered a cost of financing the car for your business, and it is generally deductible as a business expense. However, if you are also using the car for personal purposes, you should only claim the portion of interest that corresponds to the car's business use.
It's important to keep detailed records of your car's usage, expenses, and loan interest payments to support your claims. Additionally, it's advisable to consult a tax professional or chartered accountant who is familiar with the tax laws in your country.
For further more detailed information on this topic visit: Depreciation under Income Tax Act
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sabyasachi mukherjee
(27330 Points)
Replied 23 July 2023
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