Loss relief

We’d be happy to walk you through the current rules around loss relief and work with you to explore how you can make the most of them.

Loss relief

If you incurred a loss in a given year, you may be able to offset it against taxable profits from other years. This could ultimately reduce the amount of corporate income tax you need to pay.

There are two ways to offset losses: against taxable profits from the previous year (carry-back) or against future profits (carry-forward).

Changes

Corporate loss relief laws change regularly. Recent changes have included:

a revised period for carrying forward losses;
an adjusted cap on the amount that can be offset against profits;
changes to loss relief within a tax consolidation group.

We’re here to explore your options with you and help you find an optimal response to these changes.

Ellen Punte Senior belastingadviseur

From 2022

As of 1 January 2022, loss relief rules in the context of corporate income tax have changed in the following key ways:

Loss relief is capped at €1 million plus 50% of the taxable profit exceeding that amount. For example, if your profit is €2 million, you can offset €1.5 million in losses. This applies to both carry-back and carry-forward of losses.
The carry-back period remains one year. In return for this limitation, the carry-forward period has become unlimited, while it was previously limited to six years. This change also applies to all losses still available for carry-forward as of 2022. Generally speaking, these are losses from 2013 onward (due to transitional rules).

Since 2022, organisations may therefore still have to pay corporate income tax even in large loss-making years in the short term. We’re happy to assess whether, and to what extent, this has an impact on your tax position.