ITAT Permits Business Travel Expenses Paid on Spouse’s Credit Card

LATEST MATERIAL CHANGE

What changed?

The Income Tax Appellate Tribunal (ITAT) has ruled that business travel costs incurred using a spouse’s credit card are acceptable for tax deduction purposes. The decision follows a petition from a business owner who had used his wife’s card to pay for travel related to company operations. By allowing this practice, the ITAT clarified that the credit card used for legitimate business expenses, even if held by a spouse, does not disqualify the expense from being claimed as a deduction. The ruling is expected to simplify expense tracking for small and medium enterprises that often rely on personal cards for business travel. Companies can now confidently use a spouse’s card for travel without fearing disallowance of the deduction.

Why it matters

The ruling eases tax compliance for businesses that use personal credit cards for travel, ensuring legitimate expenses are fully deductible and reducing administrative burden.