Hi, let’s say I have earned interest of Rs. 10,000 from FD in a financial year. If I have taken Loan against FD and paid Rs. 1000 interest on that, can it be adjusted against the earned interest so that the final taxable amount comes out to be Rs. 9000?
2 Likes
According to what I’ve read (couple of SC judgements), the interest amount of loan against FD will not be adjusted against the earned interest.
@Quicko can correct if my understanding is wrong here
If that’s the case, it’s beneficial.
Fixed deposit overdraft is the exclusive source of fund for my trading.
@Quicko pls acknowledge
If you’re trading and showing it as business income, you can use the interest accrued exclusively on the trading capital as it is shown as business income anyway I think.
1 Like
Hey @tarun2,
In this case, you will not be able to claim the loan interest as an expense.
Hope this helps!
1 Like
Yes, we do take the benefit of that.
Section- It comes under sec 57. You can take the benefit.
How - We do take it for our clients so it is more about posting in the ITR in the correct way.
So there is absolutely no benefit in taking loan against FD for taxation purpose.