Carry Forward of Losses

The condition that catches most people is procedural rather than substantive: a loss can only be carried forward if the income tax return was filed by the original due date, so a late filing forfeits the benefit permanently. Capital losses carry forward for eight assessment years, non-speculative business losses for eight, and speculative business losses for only four. The set-off categories are strict — a long-term capital loss can offset only long-term capital gains, and a speculative loss only speculative income. Keeping a running record of carried-forward losses matters, because the benefit is easy to lose track of and worth real money.