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Loss setoff

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Tarun Shah

16 Points Posted on 08 April 2025

business loss set off again LTCG if current year
Example
F.y. -24-25 business loss 1 cr
F.y. 24-25 Ltcg 1.10 cr

Replies (2)

Quick Summary

This discussion explains how to offset a business loss against Long-Term Capital Gains (LTCG) within the same financial year. For example, a £1 crore business loss can be set against £1.10 crore of LTCG, leaving a net taxable gain of £10 lakhs. The tax payable on this net gain will depend on the applicable LTCG tax rate, typically 10% or 20%.

Rama chary Rachakonda

Master in Accounts & high court Advocate

9620 Points Posted on 08 April 2025

Business Loss Set Off Against Long-Term Capital Gains (LTCG) In the given example, the business loss of ₹1 crore in FY 2024-25 can be set off against the Long-Term Capital Gains (LTCG) of ₹1.10 crore in the same year.

Key Points to Consider - *Business Loss*: The business loss of ₹1 crore can be set off against the LTCG of ₹1.10 crore. - *LTCG*:

The LTCG of ₹1.10 crore is taxable, but the business loss can be adjusted against it. -

*Tax Implications*: After setting off the business loss against the LTCG, the net taxable LTCG would be ₹10 lakhs (₹1.10 crore - ₹1 crore).

Tax Calculation - *Tax on LTCG*: The tax on LTCG is typically 20% after indexation or 10% without indexation, depending on the type of asset and the taxpayer's preference.

- *Tax Liability*: The tax liability on the net LTCG of ₹10 lakhs would be ₹2 lakhs (20% of ₹10 lakhs) or ₹1 lakh (10% of ₹10 lakhs), depending on the tax rate applicable.