12. What is the effect on my liability for Profits Tax if I did not make any profit, but incurred a loss in my business?
The loss can be carried forward for setting off against the future profits of your business. ( NOTE: Losses incurred in a partnership are apportioned between the partners in accordance with their agreed profit/loss sharing ratio. These losses are then dealt with according to whether each partner is an individual or a corporation. Special rules are applicable to limited partnerships, i.e. p artnership with more than 20 partners, as per section 22B of the Inland Revenue Ordinance. )
Alternatively, if you have other income (e.g. salary income) for the same year of assessment, you can select thePersonal Assessment option on your tax return. This will enable you to set off the business loss against your other taxable income. Any unutilized loss can be carried forward for setting off against your taxable income in future years.