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teja sree (Querist)
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04 December 2014 what is the meant by deffered tax asset and deffered tax liability and what is the difference between them? please suggest me thanks in advance.

Neljo Davis ACA

Neljo Davis ACA (Expert)
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05 December 2014 Deferred tax is the tax effect of timing differences. Taxes on income are considered to be an expense incurred by the enterprise in earning income and are accrued in the same period as the revenue and expenses to which they relate. Such matching may result into timing differences. The tax effects of timing differences are included in the tax expense in the statement of profit and loss and as deferred tax assets (subject to the consideration of prudence) or as deferred tax liabilities, in the balance sheet. Please refer the link-http://www.mca.gov.in/Ministry/notification/pdf/AS_22.pdf