Limitation on interest deduction bars excessive related party interest and allows limited carryforward subject to conditions. Section 94B disallows deduction of interest payable to associated enterprises to the extent it constitutes excess interest, with a deeming rule for third party loans supported by an associated enterprise. Excess interest is the lesser of interest above a percentage of the borrower's EBITDA for the previous year and interest paid to associated enterprises for that year. Exemptions apply to banking and insurance businesses. Disallowed interest can be carried forward for up to eight assessment years and claimed subject to the annual allowable interest limit. Definitions for associated enterprise, debt, and permanent establishment are provided.