What are non-capital losses and do they expire?
Allan Madan, CA
The tax term for business losses is non-capital losses. Non capital losses can be used to reduce taxable income from a prior year or a subsequent year. If they are not used within a certain time period, then the non-capital losses expire. The time period for utilizing non-capital losses depends on the taxation year in which the losses arose:
- For taxation years ending before March 23, 2004 non capital losses can be carried back (3) three years and carried forward (7) seven year
- Non-capital losses incurred after March 23, 2004 but before 2006 can be carried forward (10) ten years and carried back (3) three years.
- Non-capital losses incurred after 2006 can be carried forward (20) twenty years and carried back three (3) years.
Disclaimer
The information provided on this page is intended to provide general information. The information does not take into account your personal situation and is not intended to be used without consultation from accounting and financial professionals. Allan Madan and Madan Chartered Accountant will not be held liable for any problems that arise from the usage of the information provided on this page.
ABOUT THE AUTHOR
ALLAN MADAN
CA.CPA.CGA
Allan Madan is a CPA, CA and the founder of Madan Chartered Accountant Professional Corporation. Allan provides valuable tax planning, accounting and income tax preparation services in the Greater Toronto Area.
.png)
SOCIAL CONNECT