5. Set Off Or Carry Forward & Set Off Losses Flashcards
Intra head adjustment - salary
Not applicable
Intra head adjustment - House property
No restriction
Intra head adjustment - PGBP
- Normal business loss- no restriction
- loss from speculation business - profit from speculation business
- loss from specified business u/s 35 AD - profit from special business u/s 35 AD
Intra head adjustment - Capital Gains
- STCL - STCG/LTCG
- LTCL- LTCG
Intra head adjustment - Income from other sources
- loss of owning & maintaining race horses - income from owning & maintaining race horses
- others - no restriction
Inter head adjustment - salary
Not applicable
Inter head adjustment - House property
No restriction upto ₹ 2,00,000
Inter head adjustment - PGBP
- Normal business loss - and head other than salaries
- loss from speculative/ specified business- not allowed
Inter head adjustment - capital gains
Not allowed
Inter head adjustment - IFOS
- race horse - not allowed
- others - No restrictions
Time period - interhead benefits
Generally, interhead benefit is allowed only in the same year of loss and not allowed after being carried forward
Exception: unabsobed depreciation
Time period - unabsorbed depreciation
Section: 32(2)
Set off against: Any head other than salaries
Time period: indefinite period
Time period - Loss from HP
Section: 71B
Set off against: Income from HP
Time period: 8 Yrs
Time period - Normal PGBP loss
Section: 72
Set off against: PGBP
Time period: 8 yrs
Time period - Loss from speculation business
Section: 73
Set off against: Income from speculation business
Time period: 4 yrs
Time period - Loss from specified business u/s 35AD
Section: 73A
Set off against: Profit from specified business u/s 35AD
Time period: infinite period
Time period - Capital gains
Section: 74
Set off against:
LTCL- LTCG
STCL- STCG
Time period: 8 Yrs
Time period- Loss from owning anc maintaining race horses
Section: 74A
Set off against: Income from owning anc maintaining race horses
Time period: 4 Yrs
Loss from other sources
Cannot be carry forward
Loss from winnings
Cannot be set off or carry forward
Against income of winnings
No expense & no loss is allowed to be set off
Against unexplained credit
(Taxable)
No loss is allowed to be set off
If income is exempt
Ignore the losses relating to it
Section 80
All losses other than loss of HP and unabsorbed depreciation can be carry forward only if return is filed within due date
Even if business is closed, loss from such business
Can still be carry forward till the time limit
Order
PGBP Income -> current yr depreciation-> current yr PGBP loss -> b/f PGBP loss -> b/f unabsorbed depreciation
