Set off and Carry forward

200 views 4 replies

Vedant Khanna

374 Points Joined March 2018

Sir,
Is it necessary to set off current year business losses before setting off brought forward business loss?
(both being non-speculative)

Eg.
Income from HP = 60,000

Income from business A= 1,00,000

Current year loss in business B= 50,000

B/f loss in business A= 70,000
B/f loss in business B= 80,000

Please tell me what will be the minimum possible GTI in such a case.

Can we first set off b/f losses of 1,50,000 with PGBP income of 1,00,000
(50,000 being c/f further)

Then set off current year business loss with HP Income.

Or is it necessary that i must first set off current year loss from pgbp income only?

Replies (4)

Giridhar S Karandikar

Team Lead

7558 Points Joined November 2011

the order for set off of losses is prescribed under the act.
first current year losses to be set off. after that b/f losses then unabsorbed depreciation

Vedant Khanna

374 Points Joined March 2018

Sir can u plz mention the section.
The order which i have seen says about current year depreciation being set off first before b/f business loss.

My question is regarding current year business loss being set off against business income of another business.

If possible plz answer the example above.

Giridhar S Karandikar

Team Lead

7558 Points Joined November 2011

yes current year business loss needs to be set off first and after that if any profit remains then b/f business loss can be set off. refer section 72 for more information