Tax Book 2023

Losses Chapter- 14

Income from speculation business C 110,000

Loss from speculation business D (230,000)

Loss on 'Speculation business' c/f (120,000) -

Gain on Sale of shares of ABC (Pvt.) Ltd. 100,000

Loss on Sale of shares of XYZ (Pvt.) Ltd. (120,000)

Loss on 'Capital Gains' c/f (20,000) -

Total taxable income for the year 24 0,000

N- 1 Loss under the head Income from Property cannot be set off against Income from Salary and further
the unadjusted loss shall also not allowed to carry forward under the Income Tax Law.

N- 2 Out of total loss of Rs.140,000 the business loss of Rs.20,000 shall be carried forward whereas loss
of Rs. 120,000 under the head of income from other sources shall not be carried forward.

N- 3 Speculation loss cannot be adjusted with other than speculation income so unadjusted loss is carried
forward.

N- 4 Capital Loss cannot be adjusted with other than capital gains so unadjusted loss may be carry
forward.

N- 5 It is assume that capital assets are disposed of within one year.

Q.NO. 7 Calculate taxable Income of Mr. Z from the following:

Rs.

Salary income – taxable 247,000

Income from business

Business A 93,000

Business B (100,000)

Speculative transaction 1 (125,000)

Speculative transaction 2 65,000

Capital gains

Sale of shares of AB (Pvt.) Ltd holding period less than 12 months 69,000

Sale of shares of CD (Pvt.) Ltd holding period 3 years 88,000

Sale of shares of EF (Pvt.) Ltd holding period 8 months (77,000)

Sale of shares of GH (Pvt.) Ltd holding period 19 months (68,000)

Sales of modaraba certificate holding period 2 months 108,000

Sales of listed shares holding period 11 months (99,000)

Sales of painting holding period 7 years 90,000

Sales of antique holding period 6 years (170,000)

Solution:

INCOME FROM SALARY Rs. Rs.

Salary income 247,000

INCOME FROM BUSINESS

Speculation loss on transaction 1 (125,000)

Speculation profit on transaction 2 65,000

Net speculation loss to be carried forward (60,000)

Income from business A 93,000

Business loss (100,000)

(7,000)

CAPITAL GAIN

Sale of shares of AB (Pvt.) Ltd holding period less than 12 months 69,000

Sale of shares of CD (Pvt.) Ltd holding period 3 years

(88,000 x 100 %) 88 ,000

Sale of shares of EF (Pvt.) Ltd holding period 8 months (77,000)

Sale of shares of GH (Pvt.) Ltd holding period 19 months (68,000)

Sale of painting

(90,000 x 100 %) 90,000