Article 7 defines taxable income as gross income from all transactions minus allowable deductions and losses. To be deductible, expenses must be necessary for generating income, actually incurred, documented, and related to the specific tax year. Crucially, expenses that increase the value of fixed assets are not deductible. The article also permits the carry-forward of losses incurred during a tax year to offset net income in subsequent years, as specified by the Regulations. This provision establishes the fundamental formula for calculating the net tax liability of a business entity in Qatar.