Divya sharma (CHARTERED ACCOUNTANT) (250 Points)
25 May 2010is it mendatory to set off losses in the year when there is income ?
still it can be c/f to next year when we have income but don't want to setoff.
also can loss be setoff proportionately that is upto 8 a/y's thoda thoda kar liya each year instead of whole in 1 year .
kindly reply me as soon as possible
DT Fundas - Tarun rustagi
( Author)
(1150 Points)
Replied 25 May 2010
dear divya
it is mandotary to claim loss in every year to set off with income of that year. it is mandotary to claim 100% claim otherwise u can not carry forward the same.
regards
tareun rustagi
A.K.CHATURVEDI
(SERVICE)
(84 Points)
Replied 25 May 2010
you can not claim in style thoda thoda kar liy, you must claim 100%
Rachit
(Analyst)
(913 Points)
Replied 25 May 2010
Divya,
When you have B/F losses no prudent businessman would think of not setting it off entirely against subsequent years income; and paying tax on such income where you could avoid paying it. He could use the same (tax) funds in his business and generate income. Try applying Present value of money concept.
In my opinion, practically speaking, if you opt for your so called concept of "thoda thoda kar liya each year instead of whole in 1 year" your assessing income tax officer would definitely be a happy person and won't mind it since his tax collections are affected favourably.
CA LOVELY ARORA
(C.A. B.Com (H) Graduate)
(2151 Points)
Replied 25 May 2010
loss should be set off before its carry forward............ (if there is income)...........
C.Balaji
(Learner)
(1867 Points)
Replied 25 May 2010
Agree with above friends........
Loss should be adjusted against the Income before it is carried forward....
Nikhil
(Internal Auditor)
(208 Points)
Replied 25 May 2010
is it mendatory to set off losses in the year when there is income ?
Yes it is mandatory
still it can be c/f to next year when we have income but don't want to setoff.
In case there is income there has to be a set off. In case set off is not done then the amount which is not set off from the income cannot be set off in future. However any amount above the income that could otherwise also have not been set off because the income was not so much to set off may be set off in the coming 8 yrs
also can loss be setoff proportionately that is upto 8 a/y's thoda thoda kar liya each year instead of whole in 1 year .
no thats is also not possible
Y@$#u
(ipcc group 2, article)
(683 Points)
Replied 26 May 2010
yes it is mandatory to set off losses and accumulated depreciation in the year you have profit... it is better to set off at earliest coz current year losses can be set off against any income(subject to certain conditions).. however when you carry forward them, you can set off dat particular loss against that particular income only.... so even if it wouldnt have been mandatory it is better to set off at earliest forseeing time limiits....
saranraj
(CA FINAL)
(419 Points)
Replied 26 May 2010
Dear Friends,
can anyone tell me, in which section it has been specifically mentioned that loss should be set off in the year where there is income???
CAclubindia
