How can a salaried person claim loss on bad debts

If I have lent some money to a person and he is now unable to repay, how can I claim it as a loss in income tax returns, so that I avail some tax relief.

To give you an example, say that my gross taxable income is 20 lacs and the borrower will be unable to pay 15 lacs which I lent him over a period of last 2-3 years, how can get some tax relief?
Asked 2 years ago in Income Tax from Bangalore, Karnataka
There is no such provision in Income Tax Act to claim loss of Bad Debt.
Shiv Kumar Agarwal
CA, Delhi
225 Answers
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If you earned interest on your loan portfolio, you should have offered the same as business income or income from other sources. If you have offered the interest income in your previous returns, then you can claim bad debts in the year in which such debt becomes bad.
B Vijaya Kumar
CA, Hyderabad
617 Answers
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As per Income tax act badbebts cannot be allowed to setoff against salary income
Shyam Sunder Modani
CA, Hyderabad
1366 Answers
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There is no provision in the Income Tax Act to claim set off of loss arising out of bad debts against income from salary. 
Vijay N. Kale
CA, Hyderabad
248 Answers
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A bad debt is allowable only in the case of person who is carrying on the business  and is taxable and the accrual bad debt is in the course of  that taxable business . As mentioned above , you are salaried person and your income is taxable under the head salary , then there is no nexus of the accrual bad debt and the salary  and hence can not be claimed as deduction .
Prakash Sinha
CA, Delhi
112 Answers
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