If a Resident filing a Tax Return has had a Net Loss in any of the three years prior to the relevant year (but only one in which the Resident filed a Blue Return for the year's income taxes) (this Net Loss excludes any amount deducted in or before the previous year pursuant to the provisions of this paragraph and any amount used as the basis for calculating the amount to be refunded pursuant to the provisions of Article 142, paragraph (2) (Issuance of Refunds Based on Carryback of Net Loss)), the equivalent of the Net Loss is applied as a deduction pursuant to Cabinet Order when the amount of gross income, retirement income, or timber income for the year of the Tax Return is calculated.
If part of the Net Loss of a Resident filing a Tax Return in any of the three years prior to the relevant year (such a Net Loss excludes any amount that is subject to the provisions of the preceding paragraph and any amount used as the basis for calculating the amount to be refunded pursuant to the provisions of Article 142, paragraph (2)) is an amount of loss incurred in any of those years which is as follows and which is as prescribed by Cabinet Order, the amount that Cabinet Order prescribes as the equivalent of the Net Loss is applied as a deduction pursuant to Cabinet Order when the amount of gross income, retirement income, or timber income for the year of the Tax Return is calculated.
the amount of any loss resulting when the amount of Fluctuating Income is calculated;
変動所得の金額の計算上生じた損失の金額
the amount of any disaster-related loss on business assets.
被災事業用資産の損失の金額
The amount of a disaster-related loss on business assets as set forth in item (ii) of the preceding paragraph means the amount of a loss of Inventory or assets as prescribed in Article 51, paragraph (1) or paragraph (3) (Inclusion of Losses on Assets in Necessary Expenses) (including the amount of any unavoidable Disaster-related expenses prescribed by Cabinet Order and other than any part of the loss covered by insurance benefits, compensation for damage, or anything similar to these) due to Disaster which does not fall under the category of an amount of loss set forth in item (i) of the preceding paragraph.
The provisions of paragraph (1) and paragraph (2) apply only if the Resident prescribed therein files a Tax Return for income taxes in the year in which the Net Loss arises and if the Resident continues to file a Tax Return thereafter.
A deduction under paragraph (1) or paragraph (2) is referred to as a deduction for carryover of net loss.