Flat on rent by director to pvt ltd company

[pradip patwardhan]

Dear Experts,

my query is, at private limited company,can director of that company give his own flat on rent to pvt ltd company and then can company give that flat to the same director for his residence at free of cost as company director. what will be the effect of above transaction in all respect. Kindly reply.. itts urgent ..

thanks and regards,

Pradip

[DR.MARIAPPAN GOVINDARAJAN]

In which aspect the reply is sought? whether in taxation matter or for any other matter?

AI Summary

Director leasing property to own company and company providing rent-free residence raises related-party and tax implication concerns. Whether a director may lease his personal flat to his private limited company and the company may permit that director to occupy the premises rent-free raises questions about the legal and fiscal consequences of the related-party transaction; the respondent asks whether the advice sought is on taxation or another matter.