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    For June 2013 ICWAI Stage I Examination (Paper 7): Master Chart of Set-off and Carry forward of Losses


    Heads of Income
    Set Off During the Same A/Y
    Carry Forward  of Losses
    Same Head
    (Sect. 70)
    Another Head
    (Sec. 71)
    Against which Head
    Carry Forward
    Years
    Against which Head
    1. Salary
    Since No chances of Loss, set off and carry forward of losses is not applicable
    2. House Property
    YES
    YES
    Any Head Except Casual Income
    YES
    8
    SAME HEAD
    3. PGBF
    YES
    YES
    (Including Speculative Business)
    Any Income Excluding Salary & Casual Income
    YES
    8
    SAME HEAD
    (Including Speculative Business)
    4. Long Term Capital Gain(LTCG)
    YES
    NO
    LTCG
    YES
    8
    LTCG
    5. Short Term Capital Gain(STCG)
    YES
    NO
    LTCG/STCG
    YES
    8
    LTCG/STCG
    6. Income from other sources
    YES
    YES
    ANY
    Not Applicable (NA)
    NA
    NA
    7. Speculative Loss
    YES
    NO
    Speculative Gain
    YES
    4
    Speculative Gain
    8. Unabsorbed Depreciation
    YES
    YES
    ANY INCOME
    YES
    NO Limit
    ANY INCOME
    9. Maintenance of race horses
    YES
    NO
    Same Item
    YES
    4
    Same Item
    10. Specified Business U/S 35AD
    YES
    NO
    Specific Business
    YES
    NO Limit
    Any Specific Business
    11. Loss in respect of Casual Income
    Cannot be set off at all
    12. Loss from exempted sources
    e.g. agricultural
    YES
    NO
    Agricultural income
    Cannot Be Carry Forward

    Note:
    1.       No deduction for expenses can be claimed against casual income
    2.       For any loss to be carried forward and set-off against the income of a subsequent year the return of such loss must be filed under sec. 139. If no return is file for the year in which the loss was incurred, the right to carry forward the loss is lost.
    3.       Order in which current and brought forward losses are to be adjusted:
    Ø  Current depreciation
    Ø  Capital expenditure on scientific research
    Ø  Current loss of another business
    Ø  Brought forward losses of earlier years (Oldest loss can be adjusted first)
    Ø  Brought forward unabsorbed depreciation
    Ø  Brought forward unabsorbed capital expenditure on scientific research.

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