If the business has provided Unsecured Loan to friends/relatives.
Is it compulsory to charge Interest on that Loan every year?
Or that same amount can be remain outstanding.
3 Replies
CA. Sourav Sarkar
(Chartered Accountant )
(24583 Points)
Replied 05 March 2021
In case of relatives loan can be with or without interest
yasaswi gomes
(My grammar is 💯 good I)
(7290 Points)
Replied 05 March 2021
Drawing means cash or goods withdrawn from the business by the proprietor for personal use. It reduces the capital of the proprietor. Interest on drawings will be charged from the partner’s capital account, only if it is mentioned in the partnership deed. If partnership deed is silent, no interest on drawings will be charged. According to the business entity concept interest on drawings will be treated as income for the business and loss for the partners.
Recent Topics
- Eway Bill query for inter state
- Taxability of income in USA of resident oci holder
- Clarity regarding Sec 16(4)
- GST ON HOTEL ROOMS details
- Relief for Delayed Filing of Tax Forms
- Expire stock
- INCOME TAX AY 25-26
- Experienced CA firm for accounting & auditing
- Regarding Perquisite Tax on ESOP - Unlisted Compan
- Casual Taxable Person under GST
Related Threads
CAclubindia
