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Deduction of losses in computing the amount chargeable under the head “Capital Gains”
(1) Subject to this Ordinance, in computing the amount of a person chargeable to tax under the head Capital Gains for a tax year, a deduction shall be allowed for any loss on the disposal of a capital asset by the person in the year.
(2) No loss shall be deducted under this section on the disposal of a capital asset where a gain on the disposal of such asset would not be chargeable to tax.
(3) The loss arising on the disposal of a capital asset by a person shall be computed in accordance with the following formula, namely: — A – B where — A is the cost of the asset; and B is the consideration received by the person on disposal of the asset.
(4) The provisions of sub-section (4) of section 37 shall apply in determining component A of the formula in sub-section (3).
(5) No loss shall be recognized under this Ordinance on the disposal of the following capital assets, namely:—
(a) A painting, sculpture, drawing or other work of art;
(b) jewellery;
(c) a rare manuscript, folio or book;
(d) a postage stamp or first day cover;
(e) a coin or medallion; or (f) an antique. PART VI HEAD OF INCOME: INCOME FROM OTHER SOURCES
(2) No loss shall be deducted under this section on the disposal of a capital asset where a gain on the disposal of such asset would not be chargeable to tax.
(3) The loss arising on the disposal of a capital asset by a person shall be computed in accordance with the following formula, namely: — A – B where — A is the cost of the asset; and B is the consideration received by the person on disposal of the asset.
(4) The provisions of sub-section (4) of section 37 shall apply in determining component A of the formula in sub-section (3).
(5) No loss shall be recognized under this Ordinance on the disposal of the following capital assets, namely:—
(a) A painting, sculpture, drawing or other work of art;
(b) jewellery;
(c) a rare manuscript, folio or book;
(d) a postage stamp or first day cover;
(e) a coin or medallion; or (f) an antique. PART VI HEAD OF INCOME: INCOME FROM OTHER SOURCES
Amendment history (6)
- Added by the Finance Act, 2021.
- Inserted by the Finance Act, 2002
- The word “Dividends” substituted by the Finance Act, 2002
- The word “royalties” substituted by the Finance Act, 2002
- Inserted by the Finance Act, 2012.
- Inserted by the Finance Act, 2003.
Amendment notes captured from the source page(s); they may include changes to neighbouring provisions.
Source FBR PDF page 95
Unofficial reference, compiled from the FBR’s consolidated Income Tax Ordinance 2001 (amended up to 30 June 2026). Provided for general information only — not an official FBR publication and not legal or tax advice. Always verify against the official FBR text before relying on it for filing or any decision.