| Question And Answer | |
|---|---|
| Subject: | Wedding expenses treatment expenses claim allowed and any limit provision applicable for it purpose |
| Category: | Income-Tax |
| Querist: | Kollipara sundaraiah |
| Answered by: | Law Intern |
| Tags: | business expenses, personal expenses, Section 37(1), wedding expenses |
| Date: | March 4, 2025 |
Sir,
It assessee’s wedding expenses rs:15 lacs for the purpose of daughter’s marriage purpose f.y.24-25 paid.
Question:
1.Assessess wedding expenses amount any limit provision applicable and wedding expenses business expenses claim allowed in it purpose
2.wedding expenses debit to capital account or profit and loss account
There is no specific cap on wedding expenses under the Income Tax Act for personal purposes, but personal expenses are not deductible. The tax implications arise only if the source of funds is questioned.
Wedding expenses for a daughter’s marriage cannot be claimed as a business expense under Section 37(1) because they are personal in nature and lack a direct connection to earning business income. The Income Tax Act explicitly distinguishes between personal and business expenses, and personal expenses are not deductible.
The wedding expenses of ₹15 lakhs should be debited to the Capital Account (or Drawings Account, later adjusted against Capital) in the books of accounts, assuming the assessee is a sole proprietor or partner. They should not be debited to the Profit and Loss Account, as they are personal expenses, not business expenses.