Full carry-forward of tax losses: when a company genuinely starts a new business activity

Losses incurred in the first three tax periods from the date of incorporation may be set off against the income of subsequent periods up to the taxable income of each of them — hence without the 80 per cent cap laid down by paragraph 1 — provided they relate to a new productive activity. The Lecce judges, ruling at first instance, deny the benefit where the activity is not genuinely new but continues a pre-existing business.

For groups and extraordinary transactions the point is delicate: how the “new productive activity” is qualified affects the tax planning of losses and must be documented with concrete elements (organisation, market, capital assets). The network assists in verifying the requirements case by case.

Summary note by the CommercialistiAvvocati network, based on specialised legal and practice sources. The text does not reproduce original contributions and does not constitute professional advice.