If your business is making losses now because of COVID and if you're structured as a company, then you can actually offset your 2020, 2021 or 2022 financial year.
This is fantastic news if you're in the unfortunate position of making losses at the moment.
Normally tax losses are only carried forward - we can't go and apply them against previous profits.
Let's say you made $100,000 loss in the 2020 financial year, but you had a profit of $200,000 in 2019. You can reduce your 2019 income by $100,000. If you're a small business, you'll get $27,500 as a tax refund which is pretty substantial.
This only applies to companies. Sole traders, partnerships and trusts won’t be able to access this benefit.
This tax refund will be available as a choice to be made when a company lodges its 2021 and 2022 Tax Returns.