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ricky0(Newbie)Newbie
17 Oct 2021

if a previous business had both operating loss and capital loss and business is now sold. ABN and ACN will be cancelled. How can those losses be recouped in future.

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894 views
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BlakeATO(Community Support)Community Support
18 Oct 2021

Hi @ricky0 If the entity was not part of an income tax consolidated group, then each entity's losses are tied to that entity only. This means that if the entity has a loss, it can only be used in that entity. One way you can try to "transfer" the loss is by having the new business purchase the old one. This involves the sale of any goodwill the old one holds, assets, and trading stock. You may wish to speak with a tax agent who specialises in the sale of businesses to assist with this.

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Most helpful reply

BlakeATO(Community Support)Community Support
18 Oct 2021

Hi @ricky0 If the entity was not part of an income tax consolidated group, then each entity's losses are tied to that entity only. This means that if the entity has a loss, it can only be used in that entity. One way you can try to "transfer" the loss is by having the new business purchase the old one. This involves the sale of any goodwill the old one holds, assets, and trading stock. You may wish to speak with a tax agent who specialises in the sale of businesses to assist with this.

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