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Is it mandatory to set off losses?

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hashim hilali

35 Points Posted on 12 November 2021

I have Short term capital loss and long term capital gain, i do not want to set off my loss right now because my total income is less than 2.5 lacs /5 lacs. Setting off the loss today makes no sense due to the fact i do not have any tax liability anyway, so is it possible for me to show income separately, loss separately without offsetting, and carry forward the losses for future benefit?

Replies (3)

Quick Summary

This discussion explores whether it's mandatory to set off capital losses against capital gains in the same tax year, especially when total income is below taxable thresholds. While some advise setting off losses to enable carry-forward, others suggest it might be compulsory, with the tax department potentially adjusting returns if not done. The consensus leans towards setting off losses being necessary for future benefits.

CA Aakarsh Jain

4330 Points Posted on 12 November 2021

If the losses could not be set off under the same head or under different heads in the same assessment year, such losses are allowed to be carried forward to be claimed as set off from the income of the subsequent assessment years.

So if you not set off then you are not allowed to carry them forward