Income Tax Act 1947 · 2020 Revised Edition · Part 9 · Ascertainment of Assessable Income
37E. Carry‑back of capital allowances and losses between spouses
Feedback & supportLast amended by an amending law of 2022. 2 amendments in all.
Subject to the provisions of this section, an individual may transfer any qualifying deduction for any year of assessment to a spouse living with him or her who has claimed any qualifying deduction under this section against her or his assessable income for the immediate preceding year of assessment.
year of assessment
“year of assessment” means the period of 12 months commencing on 1 January 1948, and each subsequent period of 12 months.
No transfer may be made under subsection (1) of —
any allowance made to the individual for the year of assessment 2016 or a subsequent year of assessment; or
any loss incurred by the individual in the basis period for the year of assessment 2016 or a subsequent year of assessment.
[Deleted by Act 33 of 2022 wef 04/11/2022]
[Deleted by Act 33 of 2022 wef 04/11/2022]
[Deleted by Act 33 of 2022 wef 04/11/2022]
Qualifying deductions are to be transferred to a claimant spouse in the following order:
any allowance specified in subsection (10)(a);
any loss specified in subsection (10)(b).
The amount of qualifying deduction for any year of assessment to be transferred by a transferor to a claimant spouse is the lower of —
the amount of qualifying deduction available for transfer for that year of assessment; and
the assessable income of the claimant spouse for the immediate preceding year of assessment.
[Deleted by Act 33 of 2022 wef 04/11/2022]
The amount of qualifying deduction for any year of assessment to be transferred by a transferor to a claimant spouse must not exceed an amount equal towhere Ais any amount deducted by the transferor against his or her assessable income for the immediate preceding year of assessment under section 37D.
[Deleted by Act 33 of 2022 wef 04/11/2022]
No transfer is allowed under subsection (1) in any year of assessment if the transferor has assessable income for the immediate preceding year of assessment but no claim for relief has been made under section 37D.
No transfer is allowed under subsection (1) in any year of assessment if the claimant spouse has assessable income for the year of assessment but no transfer of any qualifying deduction from the transferor to the claimant spouse has been made under section 37C.
Any individual transferring or claiming a qualifying deduction under this section must notify the Comptroller and make an election to transfer or claim qualifying deductions (as the case may be) not later than 30 days from the date of the service of the notice of assessment on the individual or his or her spouse, whichever is the later.
Comptroller
“Comptroller” means the Comptroller of Income Tax appointed under section 3(1) and includes, for all purposes of this Act except the exercise of the powers conferred upon the Comptroller by sections 34F(9), 37L(7), 37M(5), 67(1)(a), 95, 96, 96A and 101, a Deputy Comptroller or an Assistant Comptroller so appointed;
An election made by an individual under subsection (7) is irrevocable and must be accompanied by such particulars as the Comptroller may require.
Where the Comptroller discovers that any transfer of qualifying deduction under this section against the assessable income of a claimant spouse for any year of assessment is or has become excessive, the Comptroller may make an assessment on the claimant spouse on the amount which, in the Comptroller’s opinion, ought to have been charged to tax in that year of assessment within 7 years (if that year of assessment is 2007 or a preceding year of assessment) or 5 years (if that year of assessment is 2008 or a subsequent year of assessment) after the expiry of that year of assessment.
[Deleted by Act 33 of 2022 wef 04/11/2022]
For the purposes of this section, subject to sections 35 and 37, qualifying deductions, in relation to an individual, for each year of assessment, are —
any allowance falling to be made under section 16, 17, 18B, 18C, 19, 19A, 19C, 19D or 20 that is in excess of the individual’s income from all sources chargeable to tax for that year of assessment and is not deducted under section 37D or transferred under section 37C; and
any loss incurred by the individual in any trade, business, profession or vocation which is not deducted for that year of assessment because of insufficiency of statutory income of the individual and is not deducted under section 37D or transferred under section 37C.
Despite subsection (10), any loss deemed to be a loss incurred from a trade or business for the purpose of section 97V of the Economic Expansion Incentives (Relief from Income Tax) Act 1967 in force immediately before 19 April 2016 is not transferable.
Despite subsection (10), any allowance specified in subsection (10)(a) made to a transferor for any year of assessment is not transferable if the transferor did not carry on that trade, business or profession in the basis period for the immediate preceding year of assessment.
In this section, “assessable income”, in relation to an individual, means assessable income of the individual as determined under section 37 after deducting any deductions claimed under sections 37C and 37D.[37F