ECONOMICS
INCENTIVES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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shall be carried forward to the post-exempt period.
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cannot be carried forward to the post-exempt period.
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will be disregarded.
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will be debited into exempt income account (EIA).
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Detailed explanation-1: -Loss from speculative business can be carried forward only if the return of income/loss of the year in which loss is incurred is furnished on or before the due date of furnishing the return, as prescribed under section 139(1).
Detailed explanation-2: -Set off of losses means adjusting the losses against the profit or income of that particular year. Losses that are not set off against income in the same year can be carried forward to the subsequent years for set off against income of those years. A set-off could be an intra-head set-off or an inter-head set-off.
Detailed explanation-3: -Speculative Loss can be carried forward for 4 years. Such loss can be carried forward for 4 assessment years, immediately succeeding the assessment year for which the loss was first computed.
Detailed explanation-4: -Exemption from LTCG on Shares A taxpayer can claim the exemption by reinvesting the proceeds from the sale into a specified capital asset. Such exemption would lower the capital gains and save taxes on the same. However, the taxpayer must hold the new asset for the specified period as per the relevant section.