Deferred Tax Liability


This query is : Resolved 

22 August 2009 My company does not expect to be profitable for two to three years after 31.03 09.

For the timing difference in depreciation should we provide deferred tax liability?

Or consider such liabilty when we are sure of making profits?


22 August 2009 You have consider Deferred TAx liability irrespective of whether you will make profit or loss in future. DTL on the date of Balance sheet should be reflected.

saurabh (Expert)
22 August 2009 prudence level is not to be checked for making DTL.So , even if ur Co. is goin to incurr loss .. u have to reflect the DTL in Balance sheet.

22 August 2009 there is condition with provision for deffered asstes but not with deffered liability,so u can....

22 August 2009 Some note for providing liabilty and not providing asset to be given?

Any format

Kaustuv (Expert)
01 September 2009 We are driven by the prudence principle which states that we have to recognise all losses- both actual and anticipated, but we cannot ever recognise any gain unless we realise it. So, we create DTA only to the extent of our estimation taxable profit in the future. But DTL always.


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