Temporary loss carry back for eligible companies
On 11 May 2021, as part of the 2021–22 federal Budget, the Australian Government announced it will extend the loss carry back measure.
Companies can carry back losses from 2020, 2021 & 2022 income years to offset previously taxed profits made in or after the 2019 income year. This allows companies to generate a refundable tax offset in the year in which the loss is made.
The tax refund is limited to the amount of earlier taxed profits. Also, the carryback cannot generate a franking account deficit.
Implementation Process and Costs
- The tax refund will be available on election by eligible companies when they lodge their tax returns for the 2021 & 2022 income years.
- Alternatively, companies can carry their losses forward as normal.
Similar posts you may like
- Reduce tax on holiday travel by 50% for overseas employees
This tax strategy only applies to overseas employees working in Australia, and Australian residents working overseas. Under the FBT legislation the taxable value of Read more
- Tax deductions for handbags, briefcases and satchels
Handbags, briefcases and satchels purchased to carry items for work purposes (such as laptops, tablets, work papers or diaries) may be deductible. The deductibility Read more
- Tax Planning Strategy 85 | $20,000 Asset Write-Off
Small businesses can claim a tax deduction for depreciable assets they purchase for their business provided they cost less than $20,000 each. This Read more
- Tax Savings Strategy 220 | Non-Geared Unit Trust
Non-geared unit trusts (NGUT) allow taxpayers to co-invest with their SMSF in property. The benefits of the NGUT structure include: Enables a SMSF with Read more
"You’d be stupid not to try to cut your tax bill and those that don’t are stupid in business"
- Bono: U2