DEFERRED TAX

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Hi I was wondering if anybody could help me with the accounting procedures for deferred tax. Does anybody know how it should be posted to the accounts? <BR><BR>

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    DEFERRED TAX

    Calculate provision required as the difference between the NBV and WDV of those assets on which capital allowances atre charged. Any assets not subject to C.A.'s cause permanent differences and can be ignored.If total NBV > Total WDV provide for DT at the CT rate now.<BR><BR>Post the movement required as a debit to the tax charge and credit to the provision (or vice versa if provision needs to be reduced)
  • System
    System Posts: 100,534 🤖 Admin 🤖
    DEFERRED TAX

    <br><br><< <i>Calculate provision required as the difference between the NBV and WDV of those assets on which capital allowances atre charged. Any assets not subject to C.A.'s cause permanent differences and can be ignored.If total NBV > Total WDV provide for DT at the CT rate now.<BR><BR>Post the movement required as a debit to the tax charge and credit to the provision (or vice versa if provision needs to be reduced)</i> >><br><br><BR><BR>While we are on the topic, does property revaluations form part of a deferred tax comp?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    DEFERRED TAX

    deferred tax provision is specifically prohibited on revaluations unless there is a commottment to dispose of it. Also prohibited if business intends to roll the gain over.

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