What are the deductions allowed for computing business income?

While computing business income, several deductions are allowed under Sections 30 to 37 of the Income Tax Act. These include expenses incurred wholly and exclusively for business purposes like rent, repairs, salaries, interest on loans, depreciation, bad debts, insurance premium, etc. Some deductions have caps or conditions. Note: Finance Act 2025 has disallowed depreciation on goodwill from FY 2025-26.

Supporting Case Law:
– Rajasthan State Warehousing Corporation vs CIT (2015 367 ITR 83) – Supreme Court – 2015 – https://indiankanoon.org/doc/122521305/
– Ratio: This case discussed the tests of ‘reasonableness’ and ‘commercial expediency’ for allowing business expenditure.