One of these changes stipulated by the Income Taxes Act is a new obligation for the taxpayer to exactly identify a tax loss utilized in the income tax return, not only specifying the amount but also the particular period in which the tax loss was created. Pursuant to the explanatory memorandum and the discussions regarding the adoption of the amendment above, the main reason for preparing this provision was that there were many taxpayers who did not fill in informative table E regarding tax losses in the corporate income tax return. Table E was only informative and therefore, when dealing with a tax return where a tax loss was utilised as a deductible item without the information included in table E, the tax administrator was unsure as to which particular tax loss is being utilised by the taxpayer.

Following this legislative change, the meaning of the above-mentioned table of tax losses in the corporate income tax return form has changed. Not only was the description of the required information generalised, so that the tax losses could be utilised in the subsequent as well as prior years; the table also no longer represents a record of tax losses but a detail pertaining to line 230 of the tax return form, i.e. the utilisation of tax losses as items deductible from the tax base. The instructions for filling the tax return form were changed in this sense, so that table E is now to be filled only by taxpayers who have actually been utilising tax loss deductions for the particular period and should only contain losses corresponding to the utilised item deductible from the tax base. The form therefore no longer includes all tax losses but only those that are utilised. If the taxpayer does not utilise a tax loss deduction in the tax return, table E should remain empty.

Based on our experience, we assume that if you fill in table E regarding tax losses and list the tax losses recorded by the taxpayer without utilising this deductible item in the tax return, the financial administration control system will report a non-critical error in the tax return and the tax administrator may request your explanation. It is therefore good to know about this change and avoid a possible discussion with the tax administrator in this respect.