06 October 2014
A company is having loss as per its financial statements. There is a Deferred Tax Liability of 12000 arising due to difference in depreciation rates as per Companies Act & Income Tax Act. Also there is unabsorbed depreciation to the extent of 30000 , but in the companies case there is no enough virtual certainty of adequate future taxable income. My Question is in regard to the deferred Liability , in regard to which can we adjust the unabsorbed depreciation as a deferred tax asset in the current year ?. Or will we have to show the entire depreciation difference as deferred tax liability ?
CAclubindia
