SUFFERED ANY LOSS IN BUSINESS????

If you earn losses from business, you can carry forward your loss to the subsequent years where such loss cannot be set-off due to the absence or inadequacy of sufficient profits in the relevant previous year.

Following are the conditions that must be considered for carry forward, carry forward and set-off of losses:-

1.  The loss should have been incurred in business, profession or vocation.

2.  The loss should not be in nature of a loss in the business of speculation.

3.  The loss may be carried forward and set-off against the income from business though not necessarily against the profits and gains of the same business or profession in which loss was incurred, but a loss carried forward cannot under any circumstances, be set-off against the income from any other head other than profits and gains of business or profession.

4.  The loss can be carried forward and set-off against the profits of assessee who incurred that loss, it can now be carried forward and set-off by his successor only if he carried on the same business.

5.  The loss can maximum carry forward for the period of 8 yrs immediately succeeding the assessment year in  which loss was incurred.

6.  As per section 80 of income tax act, 1961, the assessee in order to carry forward the loss to subsequent year, he must required to file income tax return.

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