Understanding Set-Off and Carry Forward of Losses under Section 70 of the Bangladesh Income Tax Act 2023

 

Set off and carry forward of losses under Section 70 | Bangladesh Income Tax Act -2023:

 As per section-70(ITA-2023),

(1) Subject to the provisions of sub-section (2), the loss determined in respect of any head of any assessment year may be set off against the income of other heads of income in that assessment year.

(2) Any loss as mentioned in the table below shall not be set off against

income under any head or source other than income under that head or source,

namely:—

Serial no:	Source or Head of income	To be set off
(1)	(2)	(3)
1.	Capital loss	Set off may only be made with capital gain.
2.	Business loss	Set off may only be made with income from business.
3.	Loss from speculative business	Set off may only be made with income from speculative business
4.	Loss from tobacco products	Set off may be made only with income from manufacturing of tobacco products.

(3) Loss from any source, income of which is exempted from tax or taxed at a reduced rate or subject to minimum tax 1[under sub-section (2) of section 163] may not be set off or carried forward.

(4) Loss of a firm or association of persons shall be set off only against the assessed income of the firm or association of persons and not against the income of any partner of the firm or member of the association of persons.

(5) If the loss of any head of income in an assessment year cannot be fully set off with the income of any other source or head of income of that assessment year, such unadjusted loss may be carried forward to successive 6 (six) assessment years for setting off.

(6) Subject to the Eighth Schedule, where any person carrying on any business or profession has been succeeded otherwise than by inheritance, the successor shall not be entitled to set off or carry forward the loss of the predecessor against any of his own income.

 

You may learn more-

Complete Section List of Income TaxACT-2023(ITA) in Bangladesh

Exercise of the power of theTribunal under Section 14 | Bangladesh Income Tax Act -2023

 

Frequently Asked Question(FAQ):

1. What is set off and carry forward of losses under Section 70?

Set off and carry forward of losses under Section 70 of the Bangladesh Income Tax Act 2023 allow taxpayers to adjust business or capital losses against future taxable income subject to legal conditions.

2. How many years can losses be carried forward in Bangladesh?

Under the Bangladesh Income Tax Act 2023, business losses can generally be carried forward for up to 6 assessment years if tax returns are filed correctly and within the prescribed time.

3. Can capital losses be adjusted against business income in Bangladesh?

No, capital losses cannot usually be adjusted against business income. They can only be set off against capital gains according to the provisions of the Income Tax Act 2023.

4. What conditions must be met to carry forward tax losses?

To carry forward losses, taxpayers must submit their income tax return within the statutory deadline and maintain proper supporting records as required by Bangladesh tax law.