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lidiabad
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- Posted Used T2 Incorporated Business, Schd 4 to carry back a non-capital loss, but... on Self-employed. 4 weeks ago
- Cheered Re: Corporation tax return T2, schedule 4, for non-capital loss, lines 901 to 903 for TurboTax-Duncan. June 20, 2021 2:32 PM
- Posted Corporation tax return T2, schedule 4, for non-capital loss, lines 901 to 903 on Troubleshooting. June 14, 2021 6:30 PM
4 weeks ago
Where on the T2 related Schedules do I put the amount of refund due for the carry back, to ensure business income and balance is accurate (for next year, for example Retained Earnings is increased due to refund)? Example: The business operated at a loss, so zero tax is owed, and the carry back refund to be received by business is $2000, and the refund is not taxable income. 1. On Schedule 125 Income Statement, do I claim a Current Income Taxes expense (line 9990) of $2000 and on Schedule 100 Balance Sheet claim a Taxes Receivable (line 1066) of $2000? (but this seems to double the income loss) 2. Or, on Schedule 100 Balance Sheet, do I claim both a liability Taxes Payable (line 2680) of $2000 and a Taxes Receivable (line 1066) of $2000? (but then Retained Earnings do not reflect the refund) 3. Or… how do I do this (so that it balances overall without being reflected as part of final taxable income)? Thank you. PS: I tried putting the value in 9990 as a negative number and in 1066 as a positive value, and it carried to Schedule 1 as a negative value (the true loss value), but when this was submitted, the CRA did not give a refund per Schedule 1, they based it on values in the Schedule 100 & 125. So, almost the entire refund was negated, and the schedules are wrong (because the refund was not received).
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June 14, 2021
6:30 PM
For the T2 for Incorporated Business, on Schedule 4 (S4), Part 1 is used to ‘carry back non-capital loss’, but the lines to determine which of the 3 available years to apply the loss to are not clear: “Line 901 - First previous tax year to reduce taxable income” “Line 902 - Second previous tax year to reduce taxable income” “Line 903 - Third previous tax year to reduce taxable income” Question: is line “901 - first year...” applicable to the most recent year or the oldest year? (eg, for 2020 tax year, does “901 - first previous year” mean 2019 (most recent) or 2017 (oldest / first year can be applied)?) (Note: we cannot ‘assume’ anything, as when you look at similar section of the T1A for other types of business, they have the actual years listed on the lines, and are in order from oldest to newest, which seems counter-intuitive relative to this form.) Thanks!
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