Restriction of Inter – Head Setoff

It is allowed in all cases except the following −

Exceptions

(1) Loss from capital gains cannot be adjusted against income from any other head

     [Both STCL & LTCL carry forward, no adjustment allowed]

(2) Loss from business can’t be adjusted against income from salaries.

(3) Loss of speculation business

(4) Loss from specified business under section 35AD

(5) Loss from business of owning & maintaining race horses

(6) Loss from lottery / cross word puzzle games etc.

(7) Loss from exempt source

 [If income is exempt its loss to be ignored, and can’t be setoff or carry forward]