The Statutory Brief

IT Act 1961 → 2025 / Section 74

Losses

Section 74 → Section 111

Carry forward of capital losses

Section 74 of the old Income-tax Act, 1961 · new section 111 under the Income-tax Act, 2025

New reference Section 111

Income-tax Act, 1961Section 74

  • Capital losses carried forward 8 years
  • STCL against any capital gain; LTCL only against LTCG

Applies to FY 2025-26 (AY 2026-27) and earlier years.

Income-tax Act, 2025Section 111

  • Same, now section 111
  • 8 years; STCL against any gain, LTCL only against LTCG

Applies from tax year 2026-27 (from 1 April 2026).

What changed

Renumbered.

Practice notes

  • VDA (crypto) losses cannot be set off or carried forward (section 194, Table Sl. No. 4).

These are summaries, not the statutory text. Read the bare Act for both sections on the Income Tax Department's official site, which also has a side-by-side comparison utility.

Frequently asked

How long can capital loss be carried forward under the new Income Tax Act 2025?

8 tax years under section 111; long-term loss only against long-term gains.

What is section 74 called in the new Income-tax Act, 2025?

Section 74 of the Income-tax Act, 1961 corresponds to Section 111 of the Income-tax Act, 2025, which applies from 1 April 2026 (tax year 2026-27).

What changed in section 74 under the new Income Tax Act?

Renumbered.

Is section 74 still applicable for FY 2025-26?

Yes. Income of FY 2025-26 (AY 2026-27) and earlier years is governed by section 74 of the 1961 Act. Section 111 of the 2025 Act applies from tax year 2026-27.

Related sections

70 / 71→108Set-off of losses in the same year: within a head and across heads112A→198Tax on long-term capital gains from listed equity shares, equity mutual funds and business trust units (STT paid)111A→196Tax on short-term capital gains from listed equity shares, equity mutual funds and business trust units (STT paid)