The Income Tax Act, of 1961 allows several deductions for taxpayers which help them to manage their tax liability better. Section 36 of the Income Tax Act allows persons to claim certain expenses incurred during the course of any business or profession as a deduction.
Taxpayers can claim such tax benefits while computing their income from businesses or professions. In order to know which expenses are liable for deductions, read on!
Here is a list of expenses that one can claim as deductions:
Also Read: Section 80GG – Eligibility & Steps To Claim Deduction For Rent Paid Under Section 80GG
Section 36 of the Income Tax Act allows businesses and professionals to reduce their tax liability by claiming expenses incurred by them while carrying out their operations as deductions. Taxpayers must carefully go through each subsection and claim deductions according to prescribed provisions.
Also Read: What is Section 80D of Income Tax Act: Deductions for Medical & Health Insurance
Ans: According to this Section, taxpayers can claim certain expenses as deductions only in the year in which the payments were actually made. IT Department does not allow deductions in the year in which liability occurred.
Ans: Expenses not covered under Sections 30 to 36 and which incur during the course of business are allowed as deductions. Persons can claim such tax benefits to reduce their tax liability.
Ans: Corporations or a body corporate established by a state government or Central Government and notified in the official gazette can claim expenses related to the promotion of family planning among their employees. These expenses are not of a capital nature and come under eligible deductions as per Section 36 of the Income Tax Act.
Ans: Section 36(1)(viia) deals with deduction against the provision for bad debt of rural branches of commercial banks. The deduction amount will be equal to 8.50% of the total gross advances plus 10% of aggregate advances given by the rural branches.
Ans: Banks incorporated outside Indian territory can also claim provision for bad debts as a deduction u/s 36. However, this is limited to 5% of their total gross income in the preceding financial year.
This article is solely for educational purposes. Navi doesn't take any responsibility for the information or claims made in the blog.
|Section 145A||Section 80P||Section 92CD|
|Section 281||Section 32(2)||Section 270A|
|Section 1399||Section 192A||Section 11|
|Section 35AD||Section 80C||Section 32|
|Section 206AA||Section 92E||Section 9|
|Section 153||Section 10(10D)||Section 194DA|
|Section 10AA||Section 80GG||Section 80TTB|
|Section 80JJAA||Section 1940||Section 23B|
|Section 206AB||Section 44AB||Section 87A|
|Section 115JB||Section 154||Section 194D|
|Section 194J(1)(ba)||Sectio 80U||Section 194K|
|Section 56-59||Section 80TTA||Section 234C|
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