It’s never a good thing to make a loss, but there is no denying that tax losses can be a useful tool in reducing your tax bill. For this reason, there are some restrictions on how (or whether) tax losses can be deducted or applied, and these restrictions will differ depending on both the type of loss you have incurred and the type of entity making the loss.

This comprehensive course contains the rules that make certain types of tax losses easier to use or ensure that the value of the loss does not erode over time. Assist your clients to strategically manage losses and deductions. 

Key topics:

  • Types of tax losses
  • Individuals and losses
    • Passive income
    • Active income
    • Carrying on a business
    • Non-commercial loss rules
    • Capital losses
  • Partnerships and losses
    • General law partnership
    • Tax law partnership
    • Non-commercial loss rules and partnerships
    • Assessable income test
    • Profits test
    • Real property test
    • Other assets test
    • Other issues for partnerships under the non-commercial loss rules
    • Capital losses and partnerships
  • Companies and losses
    • Continuity of ownership test (COT)
    • Division 165 rules
    • Voting power
    • Rights to dividends
    • Rights to capital distributions
    • Special rules affecting the tests
    • Prevention of loss multiplication within a company group
    • Subdivision 165-CC and Subdivision 165-CD
    • Modified COT for certain companies
    • ‘Widely held companies’ and ‘eligible Division 166 companies’
    • The tracing concessions
    • The same business test (SBT)
    • New business test
    • New transactions test
    • The anti-avoidance provision 
    • Proposed similar business test
    • Detailed analysis of the first limb under s. 165-210(1)
    • Changes in activities
    • Detailed analysis of the second and third tests under s. 165-210(2) of the ITAA97
    • Application of the rules to bad debts
    • Capital losses
  • Trusts and losses
    • Non-fixed trusts and fixed trusts
    • The trust loss tests
    • The control test
    • The 50 per cent stake tests
    • The pattern of distributions test
    • Income injection test
    • Family trust election

This course consists of one hard copy learning manual and one online assessment.

Want to know more? Click below to view a sample of the learning manual:

Learning objectives

  • Identify the different types of tax losses and restrictions about deducting each type of loss
  • Describe the restrictions that individuals face when deducting tax losses
  • Identify the rules that apply to the recoupment of tax and capital losses to partners in partnerships
  • Understand the difference between private companies, public companies and widely held companies, and apply the rules that apply to each in deducting their tax and capital losses
  • Apply the continuity of ownership test (COT) and same business test (SBT) to practical examples where a company seeks to carry forward a tax or capital loss
  • Differentiate between the different types of trusts and the restrictions that apply to each category of trust in utilising tax losses
  • Explain the eligibility conditions that must be met by a trustee seeking to make a family trust election


This course is suitable for public practitioners and tax professionals with responsibility for the preparation of income tax returns for individuals and businesses involving losses.

This course is based on the Australian taxation system.

365 Days