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Interest free loan
08-15-2010, 06:10 PM,
#1
Interest free loan
What will be treatment of Interest Free loanin case the employer has charged more than the Benchmark rate e.g. benchmark rate is 11% but employer has charged 12% and the amount of loan is 900,000.
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08-16-2010, 02:50 AM,
#2
 
dada if the employer has charged 12% than how come you are calling it interest free???
furthermore income tax ordinance 2001 section 13(7) and 13(8)
caters the situation when loan is interest free or interest is lower than the bench mark rate however in the situation you presented neighther of two things are present.

and as no deductions are allowed under head salary thus employee wont be able to claim the benefit of interest paid as expense..neighter we would treart is as income of employee

furthermore the tax section<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by dashing_dear</i>
<br />What will be treatment of Interest Free loanin case the employer has charged more than the Benchmark rate e.g. benchmark rate is 11% but employer has charged 12% and the amount of loan is 900,000.

<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
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08-16-2010, 08:17 PM,
#3
 
hahah mamu mujhe pata tha yahi sawal uthay k interest free kese hai? but same problem hamare paper main aai thi is liye poocha tha )
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by imdad1</i>
<br />dada if the employer has charged 12% than how come you are calling it interest free???
furthermore income tax ordinance 2001 section 13(7) and 13(8)
caters the situation when loan is interest free or interest is lower than the bench mark rate however in the situation you presented neighther of two things are present.

and as no deductions are allowed under head salary thus employee wont be able to claim the benefit of interest paid as expense..neighter we would treart is as income of employee

furthermore the tax section<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by dashing_dear</i>
<br />What will be treatment of Interest Free loanin case the employer has charged more than the Benchmark rate e.g. benchmark rate is 11% but employer has charged 12% and the amount of loan is 900,000.

<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
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08-16-2010, 09:27 PM,
#4
 
I think u have misunderstood the question

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by dashing_dear</i>
<br />hahah mamu mujhe pata tha yahi sawal uthay k interest free kese hai? but same problem hamare paper main aai thi is liye poocha tha )
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by imdad1</i>
<br />dada if the employer has charged 12% than how come you are calling it interest free???
furthermore income tax ordinance 2001 section 13(7) and 13(8)
caters the situation when loan is interest free or interest is lower than the bench mark rate however in the situation you presented neighther of two things are present.

and as no deductions are allowed under head salary thus employee wont be able to claim the benefit of interest paid as expense..neighter we would treart is as income of employee

furthermore the tax section<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by dashing_dear</i>
<br />What will be treatment of Interest Free loanin case the employer has charged more than the Benchmark rate e.g. benchmark rate is 11% but employer has charged 12% and the amount of loan is 900,000.

<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
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08-17-2010, 02:14 PM,
#5
 
no..this may b the way to confuse the students d...the right answer is really that..it is not a intrest free loan D
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08-17-2010, 07:56 PM,
#6
 
Ji Bilkul,
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