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How to Add Previous Years’ Losses to your Income Tax Return on ClearTax

By Ektha Surana

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Updated on: Jun 7th, 2024

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5 min read

Set Off means using certain losses to reduce the income from other sources in the same assessment year. If some losses cannot be fully utilized in the current year, they can be carried forward to future years for offsetting against income in those years. This is known as Carry Forward. In this article, we've discussed a summary of losses that can be set-off and carry forward and how to add previous years' losses in your Income Tax Return (ITR).

Summary of set-off and carry forward of losses

Type of LossesIntra Head AdjustmentInter Head AdjustmentCarry Forward?Set-off in next year against?Time Limit to carry forwardMandatory to file ITR for carry- forwarding loss?
Loss from SalaryLoss from salary is not possible
Loss from 
House Property 
AllowedAllowed, but only up to 
Rs 2,00,000
Allowed Income from House Property8 yearsNo
Loss from Speculative BusinessOnly against speculative business incomeNot AllowedAllowed Income from Speculative Business4 yearsYes
Loss from Specified BusinessOnly against specified business incomeNot AllowedAllowed Income from specified businessUnlimitedYes
Other Business LossesAllowedAllowed (except from Salary income)Allowed Income from Normal Business8 yearsYes
Short Term Capital LossOnly against 
STCG & LTCG
Not AllowedAllowed STCG & LTCG8 yearsYes
Long Term Capital LossOnly against LTCGNot AllowedAllowed LTCG8 yearsYes
Loss from Owning and Maintaining Race HorsesOnly against Income from Owning and Maintaining Race HorsesNot AllowedAllowed Income from Owning and Maintaining Race Horses4 yearsYes
Loss under ‘Other Sources’AllowedAllowedNot Allowed N/AN/AN/A

Note: First, you need to make intra-head loss adjustment before considering inter-head loss adjustment.

Procedure to add previous years’ losses in your IT return for the current assessment year

Step 1: Log in to your account on www.cleartax.in and link you PAN and add the income details. (Refer to this page for more details)

Step 2: Under ‘Tax Saving’ tab > scroll down to ‘Carry Forward of Losses’ section > click on edit details

Step 3: Here, click on ‘Add Previous Year Losses’ to enter the details of brought forward losses. 

Step 4: Select the assessment year (the year in which you had incurred the loss). Then select the loss category from the dropdown menu. Enter the loss amount in negative by prefixing a ‘-’ sign. 

Step 5:  Similarly, you can also add details of unabsorbed depreciation by clicking on ‘Add Previous Year Depreciation Loss’. 

Step 6: Scroll down and click on ‘Edit Dates’ and enter the date on which you had filed your ITR for that year. You can find this date in your previous year's ITR. But if you had filed with Cleartax, we will autofill this for you. Once done, click on ‘Save’.

Enter due date of return filinh

Then, click on ‘Go to Next’ button placed on the right-hand upper corner of the page and proceed to e-filing.

About the Author

Multitasking between pouring myself coffees and poring over the ever-changing tax laws. Here, I've authored 100+ blogs on income tax and simplified complex income tax topics like the intimidating crypto tax rules, old vs new tax regime debate, changes in debt funds taxation, budget analysis and more. Some combinations I like- tax and content, finance & startups, technology & psychology, fitness & neuroscience. Read more

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Quick Summary

Set-off means using losses to reduce income. Carry Forward allows carrying losses to next year. Various types of losses, such as from salary, property, business, and racehorses, have different rules for set-off and carry forward. Procedure to add previous years' losses in current year's IT return involves logging in, linking PAN, adding income details, selecting assessment year, entering loss details, and filing.

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