Declaring Carry Forward loss in ITR 2

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Hi,

I had sold a property in Nov 2019 and incurred Long term Capital loss on it. It was declared in last year (FY 2019-20, AY 2020-21) ITR. This year there is no change in status of LTCL and I further need to carry it forward.

My queries are:

- Do I need to declare it in current ITR? There is no LTCG to adjust against it, so it just needs to be carried forward and not included in any IT calculations. Since it has no impact, so I am not sure.

- If so, under which schedule? Schedule CFL appears to be appropriate for it. It is asking for date of filing and amount. Is that correct schedule I am looking at?

 

Regards

Abhishek

Replies (2)
Second point mentioned is correct. u have to show the amount of LTCL against respective year.

To declare carry-forward losses in ITR-2, use Schedule CFL (Carry Forward of Loss).

Schedule CFL has two parts:

PART 1: Brought-forward losses from prior years
Enter the assessment year, type of loss, and amount. Types: house property loss, STCL (short-term capital loss), LTCL (long-term capital loss), business loss, speculative business loss.

PART 2: Current year losses going forward
After Schedule CYLA sets off current year losses, any unabsorbed balance is carried forward. The system auto-fills this from Schedule CYLA.

Key set-off rules:
- STCL (short-term capital loss): can be set off against BOTH STCG and LTCG.
- LTCL (long-term capital loss): can ONLY be set off against LTCG (not STCG).
- House property loss: can be set off against any other income head up to Rs 2 lakhs per year.

Carry-forward periods:
- Capital losses: 8 assessment years
- Business losses (non-speculation): 8 assessment years
- Speculative business losses: 4 assessment years

CRITICAL RULE: To carry forward losses, the ITR must be filed ON OR BEFORE the due date (July 31, 2026 for non-audit cases). A belated return filed after July 31 LOSES the right to carry forward most losses. House property loss is the only exception (it can be carried forward even in a belated return).

So if you have capital losses or business losses to carry forward, do not file late.

For the full Schedule CFL and CYLA walkthrough in ITR-2 for AY 2026-27 including the step-by-step form structure, this [ITR-2 guide for AY 2026-27](https://taxgarden.in/blog/itr-2-ay-2026-27-who-can-file-changes-deadline) covers the complete loss reporting and carry-forward process.

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