Calculation of deffered tax
Querist : Anonymous
Assume i have purchased machinery
Rs. 1 Lakh on 1/10/2015, depreciation
As per company act. Is 9500/- (SLM) and
Depreciation as per income tax is 15000/-
However useful life of machinery is 10
Year, please let me know the complete treatment
of deffered tax how the DTL/DTA will create
and how it will be reverse in subsequent year
Waiting for your kind reply.....
Thanx & Regard
Radhika chauhan
Income tax depreciation is based on wdv so it will decrease over the period.
DTL has to be created when IT depreciation is more and it has to be reversed when it is less.
Querist : Anonymous
tax here DTL will be create of 1699.5/-
right.....
sir please let me know complete treatment
with reversal also....
Def Tax Expense (PL) Dr.
DTL (BS) Cr.
with the calculation as described above, you will keep creating DTL for each year. And when this differences start reversing, you need to reverse the DTL also.
Entry for same would be -
DTL (BS) Dr.
Def Tax Expense (PL) Cr.
Thanks
Querist : Anonymous
Will be exceed then dep. As per company act.
As follow...
Year WDV dep. IT DEP co.
1 100000 15000 9500
2 85000 12750 9500
3 72250 10838 9500
4 61412 9212 9500
Hence till three year dep. As per IT act.
is exceed than as per co. Act. And the
in three year the difference is 10088/-
10088*30.9 3117/- the LTA will be create
in three year 3117/- after that plz tell me
how long will i have to reverse the same...
1 100000 15,000 9500 -5,500 30.90% -1,700 -1,700
2 85,000 12,750 9500 -3,250 30.90% -1,004 -2,704
3 72,250 10,838 9500 -1,338 30.90% -413 -3,117
4 61,413 9,212 9500 288 30.90% 89 -3,028
5 52,201 7,830 9500 1,670 30.90% 516 -2,512
6 44,371 6,656 9500 2,844 30.90% 879 -1,633
7 37,715 5,657 9500 3,843 30.90% 1,187 -446
8 32,058 4,809 9500 4,691 30.90% 1,450 1,004
9 27,249 4,087 9500 5,413 30.90% 1,673 2,676
10 23,162 3,474 9500 6,026 30.90% 1,862 4,538
Querist : Anonymous
Clarification... as per your calculation
in 8 year DTL become Zero.. but at 10 year DTA is 4538 plz
let me know what will be the treatment of DTA
Expecting reply soon....
Pls share ur mail I'd I will sent you the excel file tomorrow.
Thanks
Querist : Anonymous
sandeep sir... plz provide me complete solution of my query
as above mentioned with year wise calculation and accounting entry for the same,
email I'D rgoyal.423@rediffmail.com
Querist : Anonymous
also request you to pass the accounting entry year wise for batter understanding..
pls revert...
Querist : Anonymous
pls... waiting for your reply......
Querist : Anonymous
All the entries from the bignning till scrap
The asset as per calculation made by you,
:
Waiting for your valuable reply....
Querist : Anonymous
Pls revert....
Querist : Anonymous
I have post the query at your Email I'D pls
Check & revert...:
Querist : Anonymous
I think No Need to send the mail because
The query is not much biger.. i also study
Your latest attactment all the point pertains
To this particular query was really well
Explained by you however some confussion
also thereon as follow..
(1) you have disclose the diff -14687/- plz
Clarify how this diff is arries,
(2) wdv as per IT act.at the end of year 10th is 19687/- plz
Clarify at the end of 10th year what will the
treatment of this figure 19687/-
Pls revert....
Querist : Anonymous
-14687
Plz check...
Querist : Anonymous
Confused you were right... i want to know
At the end of year 10th after charging the
Dep. As per IT act. Wdv was left 19687/-
Plz let me know what will be the treatment
of this figure 19687/-
plz revert....
I mentioned in the file that i am assuming it is the only asset in the block and after 10 years it will be disposed off / sold.
Querist : Anonymous
The asset by passing entry..
Loss on asset Dr..5000
To asset...5000
This is the treatment for books of accounts..
But the value of wdv of IT 19687/- is still left
What about this WDV
Querist : Anonymous
cannot be pass because the WDV as per
IT is not reflect in books of accounts' right'
plz revert..
Querist : Anonymous
Tax computation for AY 2016-17.
Book profit xxxxxx
Add
Book depreciation xxx
Provisions xxx
Less
IT depreciation xxx
Taxable profit xxxxxx
Querist : Anonymous
IT WDV 19687/- with an example... weather
It will be add or less,
If asset is continued to be used continue the IT depreciation in IT workings.
In case it is disposed off for 10000. Claim in IT 9687 as loss on sale of asset.
Querist : Anonymous
Will be add or less
Querist : Anonymous
Also be add/less
Pass the following entry on the balance DTL.
DTL(BS) Dr
Deffered tax expense (P & L) Cr.
Querist : Anonymous
Cumulative DTL 1500 and i have pass the
Entry for the same i.e,
deff. Tax exp. DR..1500
To DTL..1500
However by passing this said entry profit
Become reduce,
pls let me know while computing the income
will this 1500 shall be Add or less
DTL (BS) Dr 1500
To Deff tax Exp. (P % L) Cr 1500
By passing the entry profit will increase.
Querist : Anonymous
Entry the profit become increase,
However this entry will be pass when
IT dep. Will be less then the dep. As per
com. Act.
My query was assume in AY 2016-17
I have pass the entry.. i.e,
Deff. Tax exp DR....1500
To DTL ....1500
As there was cumulative DTL of 1500 in AY
2016-17,
pls let me know while computing income
for AY 2016-17 will this 1500 be add or less,
Querist : Anonymous
The entry. I.E,
DTL DR...
To deff. Tax. Exp...
then it will be add right...
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