Friends
I have often seen that in case of a private limited company, the rental expenditure of personal residence of directors is generally booked as business exp of company. Likewise in case of proprietorship biz.
Are we safe if we put in the terms of appointment that directors are eligible for rent free accommodation? In such case is it OK even if rental agreement is personally in the name of director and company is reimbursing the director?
Our auditor suggested, in the rental agreement you put it as the premises is being taken for company business activity even though the director and his family resides. So that there is no problem during tax scrutiny
CAclubindia
