Tax Benefits On Business Loans In India

Worried about if taking a Business Loan will have an adverse effect on you next year’s taxes? There is nothing to worry about, Business Loans Are Tax Deductible!

Loans do not fundamentally have any effect on the taxes. As per the Income Tax Act, 1961, increasing or getting capital/money through loaning is not same as earning money for the business enterprise. This is why, the interest levied on the loan is tax deductible. However, the principle amount is not.

Benefits of Availing Business Loan?

In many cases, business loans play a key role in the business specific growth for organizations availing the same. From meeting working capital requirements, expanding infrastructure to paying debt and much more, loan act as a fuel to the business. Taking up business loans in India can be highly beneficial, some benefits that can be availed are as follows:

1. One can use the borrowed money in a flexible manner for varied purposes
2. The SMEs are also supported highly, government has launched several SME Loan options at lower interest rates
3. One can opt for most beneficial and flexible repayment options which makes reimbursement of loans convenient for borrowers
4. The reduction in interest payment takes massive burden off the shoulders of borrowers as interest paid on business loans is tax deductible.

Tax Benefits That Can Be Availed Under Business Loan?

The benefits of availing Business Loans in India varies from lender to lender. The borrowed money is treated as an expense due to it being utilized strictly for fulfilling business purposes. The biggest benefit that can be availed has been the tax destructibility of interest paid on the loaned money. Government of India offers more benefits to SMEs and MSMEs.

Conclusion: Availing Business Loans in India in modern times is easy. However, one shall always make sound decision and chooses the most suitable Business Loan after consulting with a financial expert. The expert will help you realizing the benefits that can be availed from specific Business Loans. The benefits do not limit to tax benefits but you can avail many other benefits. So, what are you waiting for? Apply Today!

Why Taking Loans Can Often Be Beneficial For Businesses?

In this current situation where the covid-19 pandemic has enforced lock down in many parts of the world, it has become difficult for many businesses whether small or large to sustain themselves. In order to ease the economic situation in India, the government decided to bring out several relief packages for businesses and among them, the most significant proposal was the automatic Collateral Free Business Loans of Rs. 3 lakh crore.

Even so, not all businesses can avail this loan as only those are entitled to it who already have unpaid loans of up to Rs. 25 crore. The reason why this loan is not applicable for new lenders who want fresh loans is that, before giving a business loan, banks often want to know the borrower, particularly in difficult economic circumstances like today’s.

There are numerous Business loans in India like Quick Business Loans, Collateral Free Business Loans, Short Term Loans, MSME Business Loans, Small Business Loans, etc., which can be availed by the businesses. And when you take any of the loans from bank, that record goes into your credit profile. This way, banks can anytime assess your business and can check your feasibility as well as your ability to repay the respective loan. However, if there is not even a single loan taken by you, then you won’t even have a credit history which generally makes the lender reluctant to offer the business loan. It doesn’t matter how big or small is the amount of your loan; it all comes down to your ability and timely repayment of the loan.

Even some quick small business loans can also be very helpful in increasing your credit rating and eventually enable you to take bigger loans in the future. The key is to build up good relationship with the bank by taking smaller loans as suddenly approaching them for big amount of loan can reduce your chances of getting one. For this, there are many low interest business loans in India, commercial loan for small business, sme loans, flexi business loans etc., which can be beneficial for businesses to enhance their credit profile.

Can You Take Out Multiple SBA Loans

Every small business owner aspires to access capital in critical times. It is essential for a business’s survival, whether it be for smoothing the gaps in cash flow or hiring task force. Capital becomes even more important in uncertain times.

Do you lack funds to sustain your business or to complete certain projects? You can rely on many options available in the financial market. Let us tell you about SBA and how it is one of the most beneficial options.

What Are SBA Loans?

The SBA Loans are a great way to obtain financial help from a bank, micro lenders or community organizations at reasonable terms. This variety of loans are comparatively flexible than other options available in the market. It can help you in covering working capital needs as well as fixed assets. SBA has strict borrowing requirements, which make them harder to qualify for. One will need to have an excellent personal credit score as well as stable business finances.

Still, majority of SBA lenders will accept your application for multiple SBA loans; however, it comes with some limitations and added risks. One should read this post fully to make a sound decision.

Can You Take Out Multiple SBA Loans?

Yes, one can take out multiple SBA loans. If you do not exceed SBA program limit, you can take multiple SBA loans outstanding at the same time. To qualify for such multiple loans, you must have a good standing on the first loan. You must also prove to the bank that you have positive cash flow, sufficient collateral and strong credit score,

Pros & Cons of Taking Out Multiple SBA Loans!

The most basic benefit of taking out more than one SBA loan is access to capital at favorable terms. Many financial experts recommend taking out Multiple SBA Loans due to the following pros:

• You can access larger capital by applying for SBA Loans
• The down payments of the loan can be lowered down significantly
• SBA loans are offered to you at lower interest rates compared to other options
• You can negotiate longer repayment terms with the lender

However, SBA Loans also have their cons; the biggest drawback is that having multiple SBA loans adds risk to your business’s balance sheet. If your business has sporadic cash flow or seasonal flow, this is not for you as it might cause trouble making monthly payments. This put the personal assets as risk. There is also a stringent borrowing limit.

Bottom Line: Taking Out Multiple SBA Loans is of great help to a business but one should be careful. Every business is different and requires unique support. Make sound decisions with the support of financial expert at all times. TI Lending is offering Quick Business Loans in India.

Suffice Business Needs With Unsecured Business Loans

Many entrepreneurs pursue business loans for sufficing their additional financial requirements. There are times when even profitable businesses need to borrow some amount of cash for performing their expanding operations, pay rent or look out for other common expenses. You are not only one who wishes to borrow a loan amount for their business but cannot afford to place any collateral as security to the lender. To ensure that the absence of high-value assets as collateral in your business does not hamper your eligibility criteria for availing business loan, opting for unsecured business loan is something you should consider for.

With this type of loan, you can easily focus on growing and expanding your business. Apart from quickly availing the amount of business loan you wish to, you can have your peace of mind as your need not to part parting with your valuable assets. Let us look how you can avail unsecured business loan at an amazing rate of interest.

When it comes to starting a business or expanding an existing one, investment is always required. And, if you are wishing to borrow an unsecured business loan, you can also go for the short-term one as it will provide you with the funds to meet all your short term requirements. Thus, letting you run your business successfully without any pressure of repaying loan amount for long term. Repaying quickly while availing short-term unsecured business loan will help you get instant loan amount the next you apply for it.

Are you worried about your bad credit score? Worry no more because unsecured business loans allows the borrowers to avail a good loan amount despite their credit problems. Some other benefits of this loan type are listed below:

1. Short application process
2. Collateral is not required
3. No risk of having your valuable asset taken away
4. Easy eligibility criteria
5. Short repayment deadlines
6. Availability of smaller loan amount, etc.

Have some more queries? At TI Lending, we aim to support all the business runners running different businesses with our expertise on financing. We always consider the best option to render hassle free application for our customers so that they can avail collateral free business loan within the shortest time possible.

Secured Business Loans- Sorting Out Financial Woes

The foundation of every business is its capital; it is an important asset to the venture. Not all can invest capital necessary to keep a business afloat out of their pockets. This is why; one should consider Secured Business Loans. They provide the necessary financial assistance to the businesses by making use of owner’s equity and property.

How Secured Business Loans Sort Out Financial Woes?

Every business has its own financial woes, many of which cannot be sorted easily. Don’t worry; carefully taken loan can be of great help. One can rely on such financial assistance to support the business in several ways. One can use a well-structured Business Loan to repay previous debts which could be hindering business growth. It can also be used to establish a new business enterprise. Further, it is also great tool, which helps existing businesses in expanding.

What To Consider Before Applying For A Secured Business Loan

Secured Business Loan is a greatly helpful support to business; however, it has different effect on different businesses. One shall consider the following aspects before sending in a loan application to the lender:

1. Interest Rate: One should make sure that interest rate on the loaned money is favorable to the company and is the best available in the market. Usually, the interest rates for such loans are exceptionally low. However, if you have a bad credit history, you will have to pay a much higher rate than the others. You can also discuss whether you will be opting variable or fixed interest rate.
2. Collateral: One should decide on appropriate collateral that can justify the requested financial assistance. A lender will not offer you the best loan options, if he does not find the collateral reliable enough to proceed. 
3. Payment Installments: One should discuss repayment as well as flexible & small installment plans with the lender beforehand. It makes the repayment easier and decreases the burden on the business.

Financial assistance is the key to success if it is taken with care. This is the reason; you should pay attention to the financial market before applying for loan. Finding the right loan for your specific needs is what you need to focus on. Such good small business term loans will solve all of our business problems!

6 Steps for having The Perfect Business Loan Package

One thing that every business can agree upon is that getting business loan is not easy. Even many successful businesses fail to get approval for their applications. As hard as it may seem, it is not impossible. One can avail the desired business loan if they present The Perfect Business Loan Package. Good plans attract lenders and convince them to approve your loan. Not sure how to create the perfect plan? Do not worry, we are here to help you, continue to read and get the answer.

6 Steps for having The Perfect Business Loan Package

While applying for a business loan, one needs to be careful that they create a convincing application. To assure the same, you will need to focus on the following steps:

1. Choosing The Right Lender: Not all lenders will be the one for your company. You need to choose the one who will accept someone with your financial standing. A small sized business must always choose a lender who supports the companies of the size, same goes for other businesses of different sizes.
2. Right Collateral & Guarantee: Every bank or lender is focused on repayment. They are not going to risk their money on a loan application that does not guarantee good collateral. You must offer collateral that is worth the risk for lenders. You must convince them that even if you fail to repay your loan, they will be able to recover their money through such collateral. One must mention the current and conservative market value of the collateral.
3. A Clear Story: Your application must give a clear picture of your financial need, stability and cash flow to the lender. This is how; you will be able to gain their attention and interest. It must contain your business history and a solid plan of repayment.
4. Financial Statement and Tax Returns: No banker or lender will take your word for it, you must back your application with essential documents. Your financial statements as well as tax return documents should be attached to the application. This will increase your credibility.
5. Forecasts: Financial statements are only a part of the application; it must also contain a well formulated financial forecast of your company. This will present the strength of your managerial abilities to the lender. This will make easier for lender to determine whether you will be able to repay the loan.
6. Network: You must build a network, must contact the previous companies to whom the bank or lender has given financial aid. A reference from such companies will create a credible image of your company. This will support your application during assessment procedure.

The bottom line is if you want your business loan application to pass, you must put great efforts to create an attractive application. The above mentioned stepswill be of great help to you for getting loans to run business, it is guaranteed. So, what are you waiting for? Create a strong application today!

Business Loans: Know How To Rightly Invest Your Money And Expertise

Perks of working for your own monetary benefit, i.e., as a boss, are many but financial independence is something that is most important for availing perks. Well, there is no denying that finances are important for business development, building brand image, etc., and loans are the most perfect way to create a sound financial business position.

For taking business loans, a businessman is required to have latest business financial statement, personal tax returns copy and strong plans for investing loan. All these along with a number of basic questions are most likely to be asked by money lenders, so whenever planning to take loan, keep your facts clear and impress money lenders with your prompt answers. Money lenders on their part, keep in consideration a number of factors such as size of company, previous years tax payment report and current status of business plans, for lending money. After ensuring the aforesaid loan requests are accepted and further payments are made to businessmen.

There are a number of ways to make right investment of loans, most promising are as follows:

New business plan: Most businessmen consider loan taking, a risky job but the fact is loan serves as the simplest way of finding finance for a new business plan. For a new business plan, loan also facilitates more borrowing capacity, aids in lower monthly payments and provides repayment option over a longer period of time.

Launch new service and product: With business loan of small or big amount, you can launch a service or product; keep your business in a good shape by showing consistency in introducing new products and services. Launching better products and services keeps customers loyal and needless to cite, builds brand image along with great market reputation.

Pay off Debt: There are majorly two types of business loans- secured and unsecured. In business, it is suggested to take only secured loan for the fact that it gains more than any other form of finances. business loans for msmes allows a businessman to conserve cash as well as the working capital. Funds from secured loans are largely used for paying off current debts and provide to users an ability to make repayment schedule, as per desire and budget.

What are the pros of taking business term loan?

Businesses often opt for a loan to maintain a steady cash flow and ensure smooth operations. However, one might think that taking loan is a risky factor but whether for buying new set of equipment, acquiring new inventory, expanding the premises or even for recruitment of new staff, businesses do need funding to support their enterprise. In this scenario, the pros of getting the loan overpower the cons of not getting one. Hence, we have set a number of points that better illustrate the pros of Business Loans:

1. Capital Management

In these times of constantly changing economic environment it is necessary for a business to manage its capital in a way to preserve the cash flow during rough circumstances. Business loans aid tremendously in fulfilling and expanding business requirements, resulting in significant financial stability. This way, by taking a loan, businesses can better manage their capital for future needs.

2. Flexible Loan Options

There is something for everyone. Business owners have different options to select from a number of different types of business loans, depending on their financial requirements. Long-term loans and short-term loans vary from the loan amount to the tenor. Businesses can therefore evaluate their approximate estimates and choose the best suitable loan option.

3. Cost-Effective Rates of Interest

There are many government as well as private schemes that offer a nominal interest rate for business loans, making it easier for the owners to payback the loan promptly without any delay. Such programs are formed to help the businesses especially small ones to get a financial aid. However, before lending these loans at low rates of interest, various factors like loan amount, tenor, business capital, borrower credentials are taken into account.

4. Easy Repayment

Nowadays, the business loans whether big or small, come with convenient repaying options. Apart from selecting the appropriate loan option, business owners also have the benefit of choosing the repayment option that best suits their ability. However, it may vary from bank to bank but there are also easy modes of payout options available. On the basis of their profitability, the occasional EMIs can also be diminished or raised, making it much easier for the businesses to repay conveniently.

Do’s and Don’ts for Business Funding with Quick Business Loans

When someone starts a business or plans about restructuring it for having higher growth, there are thousands of things that come in mind. Among them, How to Finance Business is one such thing which strikes in every mind. Most of the entrepreneur agrees to the fact that a MSME business loans is a great source of capital for them. But, choosing the right type of business loan from available options including Short Term Loans, Business Line of Credit, Invoice Financing, Equipment Financing, Collateral Free Business Loans, Business Credit Cards, SBA Loans, Microloans, Commercial Real Estate Loans, etc. is a tough task.

To help you in your dilemma and make things easier, here in this blog, we will talk about certain factors to look out for so that you take right kind of loan and do not overpay for it. Here, we are giving you a few pointers to keep in mind, before searching as well as applying for a business loan:

1. Do not apply for too many loans Do not apply for too many loans

Generally, when people start their hunt for getting loans, they fill many application forms and apply to several banks & institutes, with the hope that something will stick. However, this is one such approach which can drastically affect your credit score and thereby reduce chances of qualifying for a loan.

The wisest approach for getting business loan is to firstly find out the qualification criteria of lenders and then strategically apply for two or three options that you can qualify for. Before submitting the form, make sure to ask the bank or lender about all the associated credit check policies.

2. Do check about the loan cost that you’ll have to pay

When you will ask bank or lenders about the loan cost, they describe it in different ways, some explain it by associating with the interest rate on the loan, whereas some will describe you the total amount of money that you will be paying back to them. This leaves loan seekers in high confusion in the end so the best option to deal with this situation is to ask the bank or lender about the Annual Percentage Rate (APR) of the loan.

APR is the total cost of a loan, which one has to pay over one year it includes all the associated fees as well. Mostly, the APR of a bank or SBA loan varies from approximately six to nine percentages. Lenders that provide fast loans and agree to work with even lower credit borrowers, generally take high APR. It must be noted that not always a low APR loan is better than a high APR loan. The short-term loans mostly have high APRs but as they are paid off quickly, you will not be paying interest for a long time, hence with them the total money that you pay back for them is relatively low.

3. Do check about prepayment penalties

A prepayment penalty is a fee, which a loan borrower has to pay, if he wants to pay off a loan before the due date. As the early payment of loan, reduces the overall interest amount which a lender earns on the loan so he charges a penalty against it. When you are taking a loan from bank or any institute, you must try to negotiate for reducing or removing the prepayment penalty. You should carefully read the loan documents where details about it are mentioned, before signing the loan agreement.

4. Do check of the fact that which assets are at stake if you can’t pay back the loan

There are many banks and funding companies that do not give quick business loans in India unless you put your valuable personal or business assets on seize/ stake so that if you don’t pay back the promised amount, they can take any or all of your assets to satisfy an unpaid loan. By signing on document which states about guarantee or assets you are putting as collateral, you give right to lender for seizing them if you can’t pay back the loan. Make sure to analyze the risk involved and read all the documents, before taking loans. However, it is advised to look for commercial business loans and take them, as they are more beneficial and less risky.

Conclusion There are many other things that you must consider and cross check before taking business loan for SME or MSME from any financial institute or bank. Avoid getting into trap of over interest/additional fee payments and pledging your valuable assets as collateral. It is the best to ask a trusted advisor or contact a reliable company that answers all of your questions before making you take a collateral free business loans. You can trust TI Lending for this purpose, it is an initiative of tradeindia.com, which from almost past three decades has been supporting and uplifting businesses.