INCOME TAXES (IAS 12) Flashcards
What is the scope of IAS 12 (INCOME TAXES)?
Scope : current and deferred
income taxes
What are current income taxes?
Is the amount of income taxes payable/recoverable in respect of the (taxable income for a) current period.
What are deferred income taxes?
Deferred income taxes is the amount of income taxes payable/recoverable in respect of future periods.
What is a deferred tax asset/liability?
Is a future tax payments, larger or smaller than would have been the case if recovery/settlement had no tax consequence
How are calculated deferred taxes?
Temporary difference multiplied by the tax rate expected to apply when the asset is realised or the liability is settled.
What is the temporary difference?
Is the difference between the carrying amount of an asset/liability and its tax base
When is recognised a Deferred tax liability?
Recognized for all taxable temporary differences.
- For assets: if carrying amount > Tax base
- For liabilities: if carrying amount < Tax base
When are recognised Deferred tax assets?
Deferred tax assets are recognized for deductible temporary differences, unused tax losses, unused tax credits to the extent that taxable profit will be available against which the asset can be used.
- For assets: if carrying amount < Tax base
- For liabilities: if carrying amount > Tax base
What are the exception (out of scope from IAS 12) for whom deferred taxes are not calculated?
- Initial recognition of Goodwill
- Initial recognition of an asset/liability, other than in business combination, which does not affect accounting/tax profit.
In which statement are recognised current and deferred tax?
Current and deferred tax shall be included in profit or loss for the period, except to the extent that the tax arises from a transaction or event which is recognized directly in equity or other comprehensive income.
