Tax Losses from Earlier Income Years
Tax losses from earlier income years (primary production or non-primary production) deduct against current-year taxable income, after passing continuity of ownership or same/similar business tests where required. Excess losses carry forward indefinitely. LodgeiT applies this at item L1 (individuals) or equivalent trust/company labels.
Example Scenario
Current income: $1,280; prior year loss: $4,782 (net carry-forward: $3,502)
Step 1. Recognize the amount/loss from the previous year
Step 2. Current Year Income (automatically calculated, based on the provided details)
Step 3. Record full prior loss ($4,782) and net loss ($3,502) in Business > Business Loss Activity Details at P9 using code 8 (deferred non-commercial if applicable).
Via P9 Business loss activity details
.The recording of the loss has no effect yet to the ax Estimate Calculation Figures (in green arrow)
Step 4 Work out the "Deferred Losses" tab.
Once the the loss recorded in item 16 "Deferred losses" the Tax Estimate Calculation Figures will make an offset. (see below calculation in green)
note that $3502 is the total amount of the losses ($1280-$4782=$3502)
Final calculations
ATO Related Article :
How to use Deferred Business Losses (Carried forward Loss)