Losses Chapter- 14
Any loss u/s 37A on a 'Security chargeable to tax' can only be set off against income on another security
chargeable to tax so the treatment done is not correct.
Q.NO. 4 Following are the particulars submitted by Mr. N for the tax year 20 23. Calculate taxable income
for the year.
Rs.
Income from Business 150,000
Loss from other sources (-) 50,000
B/f assessed loss for assessment year 201 5 (-) 70, 000
B/f assessed loss for assessment year 20 17 (-) 60,000
Solution: Rs.
Income from business 150,000
Loss from other sources (50,000)
100,000
Brought forward assessed loss for assessment year 201 7 (60,000)
Taxable Income for the year 4 0,000N-1 Loss of assessment year 20 15 cannot be set off as it has passed more than six years.
Q.NO. 5 Mr. Afzaal, an individual, sustained a loss of Rs. 250,000 from speculation business during the tax
year 20 23. This could not be set-off against any profits of speculation business during the relevant year.
The Commissioner Inland Revenue accepted the loss while making an assessment. Can C carry forward
this loss and what is the time limitation for carry forward?
Solution:
Speculation loss can be carried forward for future speculation incomes.
It can be carried forward for next six succeeding tax years.
Q.NO. 6 Bilal Rana, an individual, furnishes the following information relevant for the year 20 23.
Profit Loss
Rs. Rs.
Salary income (computed) 240,000
Income from property:
House A 150,000
House B 170,000
House C 210,000
Income from business or profession
Business A 80,000
Business B 100,000
Business C (speculation) 110,000
Business D (speculation) 230,000
Capital gain
Sale of shares of ABC (Pvt.) Limited 100,000
Sale of shares of XYZ (Pvt.) Limited 120,000
Loss from other sources 120,000
Required: Determine the net income of Bilal Rana for the tax year 20 23.
Solution:
Rs. Rs.
Salary income (without set off of any loss against salary income) 240,000
Loss under the head “Income from Property” (150,000 – 170,000 – 210,000) (230,000)Income from business A 80,000
Loss from business B (100,000)
Loss on Income from other sources (120,000)
(140,000)