Net operating loss means the excess of allowable deduction over gross income of the business in a taxable year.
Revenue Regulation 14-2001 implements a statute that the allowance to net operating loss-carry over will be a deduction from gross income.
Accordingly, the net operating loss of the business or enterprise for any taxable year immediately preceding the current taxable year which had not been previously offset as deduction from gross income shall be carried over as a deduction from gross income for the next three (3) consecutive taxable years immediately following the year of such loss; Provided, however, that any net loss incurred in a taxable year during which the taxpayer was exempt from income tax shall not be allowed as a deduction under this Subsection: Provided, further, that a net operating loss carry-over shall be allowed only if there has been no substantial change in the ownership of the business or enterprise in that –
- Not less than seventy-five percent (75%) in nominal value of outstanding issued shares, if the business is in the name of a corporation, is held by or on behalf of the same persons; or
- Not less than seventy-five percent (75%) of the paid up capital of the corporation, if the business is in the name of a corporation, is held by or on behalf of the same persons.
The Company started its operation on January 2013
CORRECTION: SCENARIO 1 (error: amount is omitted)
2014 Deferred Tax Asset 7,813,680
Benefit from Deferred Income Tax 7,813,680
-thanks kel.santos sa format :)-