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TDS on interest payable on loan given by individual to proprietorship company

ADHIP KUMAR MISRA (ACCOUNTS MANAGER) (176 Points)

04 August 2022

An individual has given a loan to a proprietorship company in the beginning of the current financial year. Till date the loan has not been repaid . The interest due to him on the loan repayable is more than Rs 5000 . Is TDS deductible and to be booked in accounts now , even though the loan is not to be repaid as of now ? Please clarify .

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5 Replies

Kiran Hathalia (837 Points)
Replied 04 August 2022

TDS liability is attracted to individual only when the person comes under the purview of section 44AB i.e. tax audit. Therefore, in the given case if the individual is liable for tax audit then tds on interest to be deducted.

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ADHIP KUMAR MISRA (ACCOUNTS MANAGER) (176 Points)
Replied 04 August 2022

Thanks for the reply .

Apurv Agrawal (101 Points)
Replied 04 August 2022

Yes if interest in loan exceed Rs. 5000 during any time during F.Y. then TDS liability arises on payer of Int. irrespective of fact whether loan has been square up or not..

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