“Tax losses from prior periods may offset future taxable income”
Suppose that in 2020 you had a loss of EUR 2 million on your tax return, and in 2021 you had taxable income of, say, EUR 10 million. You can deduct some or all of the prior year’s EUR 2 million loss from that EUR 10 million income, and pay taxes on a lower amount. If you’re allowed to offset it 100%, then you will pay taxes on only EUR 8 million for 2021.
Oh so it isn’t 100% usually? Well, thanks for responding!
I suspect that it varies from one jurisdiction to another.
100% is probably the most common.
Hey, thanks for the response again. Could you please also answer another query I posted under FRA? that’d be really helpful! Thanks!