Core Viewpoint - The article discusses the importance of asset loss tax deductions in corporate income tax reporting and provides guidance on how to declare these losses, including policy highlights, case studies, and key considerations [1]. Policy Highlights - Asset loss refers to losses incurred by a company during its operational activities that are related to taxable income, including cash losses, deposit losses, bad debts, loan losses, equity investment losses, and losses from fixed assets and inventory due to various factors [3][4]. - Asset losses are categorized into actual asset losses and statutory asset losses, with the former occurring during the disposal or transfer of assets and the latter recognized under specific tax regulations without actual disposal [5][7]. - Actual asset losses should be declared in the year they occur and are accounted for, while statutory asset losses require relevant documentation to confirm eligibility for deduction [9]. Deduction Timing - Actual asset losses must be reported in the year they are recognized in accounting records, while statutory asset losses should be declared in the year when the necessary documentation is retained [9]. Previous Year Losses - Actual asset losses that were not deducted in the year they occurred can be retroactively claimed for up to five years, with certain exceptions allowing for extended periods upon approval from tax authorities [11]. - Statutory asset losses must be deducted in the reporting year [12]. Case Study - A case study involving Company A illustrates the accounting and tax treatment of inventory losses due to mismanagement, detailing the calculation of asset loss amounts and the necessary tax adjustments [14][15][18]. Documentation Retention - Companies must retain comprehensive documentation related to asset losses to ensure compliance with tax regulations, including evidence of loss, accounting records, and tax documentation [19]. - Common documentation for fixed asset losses includes internal responsibility recognition, fixed asset inventory lists, and loss explanations [21]. - For bad debt losses, relevant contracts, court documents, and proof of debtor status are required [23][24]. - Documentation for equity investment losses includes proof of investment basis, bankruptcy announcements, and administrative decisions regarding the invested entity [25].