Disallowing deductions of specific expenses in Clause 94 of Income Tax Bill, 2025 vs. Section 58 of Income Tax Act, 1961

Disallowance of deductions: withholding compliance ties deductibility for cross border payments and personal expenses.

Clause 94 disallows deductions from income from other sources for personal expenses and for interest or salaries payable outside India where tax has not been paid or deducted under the withholding framework; it extends selected business-income deduction rules to other sources, prescribes computation rules for foreign companies, disallows deductions for gambling and lotteries while excepting horse racing maintenance, and links deductibility to compliance with withholding obligations.