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Deduction of prior year losses in 2014 Trust income tax return

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Kerylea
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Kerylea

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Deduction of prior year losses in 2014 Trust income tax return

Hi

I have an issue with a Trust Income Tax Return in the 2014 year using Tax 2014 in Accountants Enterprise.

 

At item 20 (Net Australian income or loss - other than capital gains) I have a loss of $50,049. I have a total net income of $48,238 at item 24.  I have total non-primary production prior year losses of $133,729, but Tax 2014 will not allow me to deduct losses of $48,238 to bring my total net income or loss at item 26 to nil.  The Losses schedule will allow me to deduct the relevant amount of losses, but the prior year losses schedule will not allow me to access the relevant box to enter the amount. 

 

As per MYOB AE>Tax2014>Income Tax Returns>Trust Return, Item 25 Label C - Tax losses deducted, if the amount at Item 24 is a net income amount and the trust is able to deduct the whole or part of prior year Australian sources losses in the current income year under section 36-15 of ITAA 1997, show the amount of prior year losses to be deducted at this item.  I believe that this return fits with this, but I'm unable to claim the losses.

 

Is this a software error?

 

I have a short deadline on this, so any assistance would be greatly appreciated.

 

Thanks

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Former Staff Esbisme
216 Posts
Former Staff
Australia
Esbisme
Former Staff

216Posts

13Kudos

32Solutions

Re: Deduction of prior year losses in 2014 Trust income tax return

Hi @Kerylea

 

Thanks for posting your question here and welcome to the MYOB Community Forum!

 

In summary you have mentioned that you have

  1. An overall Non Primary Production (NPP) loss at Item 20,
  2. Prior year NPP Losses and
  3. A Total Net Income of $48,238 at Item 24.

As you mention that you have an overall positive value at Item 24 it would seem that you would have had income that was declared or entered at one or more of the following items in the Trust return:

 

  • Item 21 Capital Gains
  • Item 22 Attributed Foreign Income 
  • Item 23 Other Assessable Foreign Source Income

Is this correct?

 

I look forward to hearing back from you.

Cheers,

Esther
Practice Solutions - Support
MYOB Australia Pty Ltd
Kerylea
2 Posts
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Kerylea

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Re: Deduction of prior year losses in 2014 Trust income tax return

Hi Esther,

 

Thanks for getting back to me.  Yes that is correct, I have a capital gain.

 

I think the issue is with the loss schedules.  I've since managed a work-around - if I delete the schedules and enter the total loss values manually, it calculates correctly.

 

Regards,

 

Kerylea

Former Staff Esbisme
216 Posts
Former Staff
Australia
Esbisme
Former Staff

216Posts

13Kudos

32Solutions

Re: Deduction of prior year losses in 2014 Trust income tax return

Hi @Kerylea

 

Thanks for your reply.

 

At this time MYOB believes that the current layout and design of the Trust Tax Return (which is set by the ATO) is done so for a specific reason which would appear to not permit a Non Primary Production loss from a prior year from being applied or offset against a current year Net Capital Gain.  We have also published our opinion on this matter and any process in the following Knowledgebase Article:

 

               KB 34098:  Can I apply Carried Forward Losses to current year Capital Gains in a Trust Tax Return?

 

Please ensure that prior to lodging this income tax return that you take the time to read this article so as to ensure that the Trust Tax Return you are preparing has been completed in accordance with all current legislation.

 

Hope this information helps

Cheers,

Esther
Practice Solutions - Support
MYOB Australia Pty Ltd
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