Newsletter
October 2012 Newsletter
New company loss carry-back regime - A Breath of Fresh Air!
The Government intends to introduce a company loss carry-back regime and has released draft legislation for public consultation.
Under the proposal, which will have effect from 1 July 2012, companies will be able to carry back up to $1 million worth of losses to obtain a refund of tax paid in the previous year. From 1 July 2013, companies will be able to carry back up to $1 million worth of losses against tax paid up to two years earlier.
The regime is proposed to be available only to “corporate tax entities” as currently defined under the tax law. The Government has said that restricting loss carry-back to those companies that have recently paid tax would target the measure to companies that have had a history of being profitable, and would improve companies' cash flow by allowing access to losses in a more timely manner.