Under section 14 of the Income-tax Act, 2025, expenditure incurred by an assessee in relation to income…

Section 14(1) says that "no deduction shall be allowed" for expenditure incurred in relation to income which does not form part of total income. Section 14(3) applies the bar even if the exempt income has not accrued or been received in that tax year. Where the Assessing Officer is not satisfied with the claim, section 14(2) lets him determine the expenditure by a prescribed method.