Hi,
My client borrows money personally from the bank for lend money to business.
Business repay principal plus interest to her.
Interest received will be her income, and interest paid to bank is also tax deductible from her personal tax return?
Normally, if a business borrows money from the bank for their business, interest is tax deductible. If I'm thinking with the same way, then it should be tax deductible personally as well...
Interest received will be her income, and interest paid to bank is also tax deductible from her personal tax return?
Yes, provided business pays interest at a higher rate than the bank charges.
There have been court cases on this.
Interest received will be her income, and interest paid to bank is also tax deductible from her personal tax return?
Yes, provided business pays interest at a higher rate than the bank charges.
There have been court cases on this.
Thanks for the answer. May I have court case details or related rulings?
22 Apr 2024 · 6 min read time
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