Eligibility for the tax offset

Eligibility for the tax offset

You can claim the tax offset if you:

• are an eligible entity
• made tax losses in the 2019–20, 2020–21, 2021–22 or 2022–23 income years
• had an income tax liability for the 2018–19, 2019–20, 2020–21 or 2021–22 income years
• have met your tax return lodgment obligations.

We have made a flowchart to help you work out if you are eligible for the loss carry back tax offset.

Download the PDF version of the Loss carry back tax offset flow chart (PDF, 351KB)This link will download a file.

View the text version of the Loss carry back tax offset flow chart – Claiming the loss carry back tax offset

Watch: Your guide to eligibility for the loss carry back measure

 

You can find more information on some of the topics mentioned in the video:

• Aggregation
• Company tax return 2021
• Company tax return instructions 2021
• Loss carry back tax offset tool

Loss carry back tax offset tool

You can use the loss carry back tax offset tool to work out if you are eligible to claim the refundable tax offset. It also calculates the maximum amount you can choose to claim if you are eligible.

The tool will provide you with a printable report that you can keep for your records. This report will help you complete your company tax return as it displays each label you need to complete to make your claim.

Eligible entities

You are an eligible corporate entity if you are both a:

• company, corporate limited partnership or a public trading trust throughout    
  • the income year that you are claiming the tax offset
  • the income year you choose to carry the loss back to (ignoring any part of the year before you existed)
  • any income years in between 
   
• small business entity in the loss year or would have been a small business entity if the aggregated turnover threshold was $5 billion.

The rules for calculating aggregated turnover are the same as those used for the small business entity concessions. Your aggregated turnover may include the annual turnover of other business entities, in addition to your own annual turnover.

Tax losses and tax liabilities

You can only carry back certain tax losses to certain income years for which you have an income tax liability.

Tax losses

You can only carry back tax losses made in the 2019–20, 2020–21,2021–22 or 2022–23 income years.

You can only use a tax loss once.

You cannot carry back:

• capital losses
• certain tax losses arising from the conversion of excess franking offsets
• transferred losses relating to either      
  • foreign banking groups (Division 170 of the Income Tax Assessment Act 1997 (ITAA 1997))
  • head companies of consolidated groups (Subdivision 707-A of the ITAA 1997). 
   

Tax liabilities

You can carry back losses to the 2018–19, 2019–20, 2020–21 or 2021–22 income year if you were liable to pay income tax for that year. Refer to Paying your liabilities and claiming the tax offset.

Lodgment obligations

To claim the tax offset for an income year, you must both:

• lodge your tax return for that income year
• have lodged for the previous five income years, refer to Working out the tax offset.

If you have not lodged for any of those income years, you may still be able to claim the tax offset if for those years, either:

• we assessed your income tax liability
• you were not required to lodge a tax return.

You must meet the eligibility requirements to choose to carry back the loss and claim the tax offset.