Hello! If your company is taxed under the Actual Profit (Lucro Real) regime, this post is for you. Today, we will discuss a crucial topic for tax planning: tax loss carryforward. Understand what it is, who is eligible, how the offset works, and what precautions to take.
What is a Tax Loss?
It’s important to distinguish tax loss from accounting loss. The accounting loss comes from the standard income statement based on commercial bookkeeping. Tax loss, on the other hand, arises after adjustments to net income, such as additions, exclusions, and offsets made in the Actual Profit Statement and recorded in the Lalur (Tax Accounting Book). This tax loss can be offset in the future to reduce the tax base for IRPJ (Corporate Income Tax) and CSLL (Social Contribution on Net Profit).
Who is Entitled to the Offset?
Only companies taxed under the Actual Profit (Lucro Real) regime are entitled to offset tax losses. Companies under the Simples Nacional or Presumed Profit (Lucro Presumido) regimes cannot offset these losses while under those regimes.
What if the Tax Regime Changes?
A common question is whether changing the tax regime affects the right to offset past losses. The answer is no. If your company was under the Actual Profit regime, then switched to Presumed Profit, and now is back to Actual Profit, the right to use previous tax losses is preserved. However, you can only offset those losses once you are back under the Actual Profit regime, provided the amounts are properly recorded in Part B of the Lalur.
How Does the Offset Work?
The offset of tax losses is limited to 30% of the adjusted net income for each period. This means that even if there is a large accumulated loss, only a portion can be used in each tax period.
Practical Example:
Suppose a company reported a tax loss of R$ 300,000 in 2023, and in 2024, it became profitable again. In 2024, the figures were:
- Accounting net income: R$ 600,000
- Adjustments (additions/exclusions): R$ 100,000
- Taxable income before offset: R$ 700,000
The offset will be limited to 30% of the adjusted taxable income: 30% of R$ 700,000 = R$ 210,000. Therefore, the company can offset R$ 210,000 of the R$ 300,000 accumulated tax loss.
The final result would be: Taxable income after offset = R$ 700,000 – R$ 210,000 = R$ 490,000. The tax base for IRPJ and CSLL would be R$ 490,000. The remaining tax loss balance available for future years would be R$ 90,000.
How to Calculate and Track Tax Losses?
Tax losses are calculated during the Actual Profit computation and tracked in Part B of the Lalur, per period.
Important: Having an accounting loss does not necessarily mean having a tax loss, and vice versa. The offset always applies to the tax loss, which is calculated after income tax law adjustments.
Is it Mandatory to Use Tax Losses?
No. A company can choose not to offset tax losses in a given year if that would be more beneficial. The offset is an option, not an obligation.
What if the Accounting Loss is Absorbed by Shareholders?
Even if the accounting loss is absorbed by shareholders or reserves, the right to offset the tax loss is not lost, as long as it is properly tracked in the Lalur.
We hope this post has clarified your doubts about tax loss carryforward under the Actual Profit regime. If you operate under this regime, understanding this mechanism can help legally reduce your company’s tax burden. Always count on ORGATEC for more information and support!