deffered tax

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prakash

prakash (Querist)
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04 July 2011 what does mean defferd tax?plz reply me good detail.

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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05 July 2011 The deferred tax assets or liability is created due to the benefits of tax if any arising to the company either by way of exemptions or by way of allowing depreciation as per income tax act. This is nothing but the book entries and not effecting your tax-ability.

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CA. Krishna K Neeraj

CA. Krishna K Neeraj (Expert)
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05 July 2011 Deferred tax arises due to timing difference.

Temporary differences are differences between the carrying amount of an asset or liability recognized in the statements of financial position and the amount attributed to that asset or liability for tax purposes.

Temporary differences may be either:
taxable temporary differences, which are temporary differences that will result in taxable amounts in determining taxable profit (tax loss) of future periods when the carrying amount of the asset or liability is recovered or settled; or
deductible temporary differences, which are temporary differences that will result in deductible amounts in determining taxable profit (tax loss) of future periods when the carrying amount of the asset or liability is recovered or settled.

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