25 May 2009
Bonus paid during the year Rs. 120000 ( for the year 2007-08) Provision for the bonus made during the year 2008-9 Rs. 140500. ( Which is not yet paid ) What is the imapct of above transactions in the calculation of Deferred Tax.
25 May 2009
In my opinion, see the following... Bonus is a 43B item which is deductible on payment basis. For Ex. lets say tax rate is 30% You must have created the DTA on Rs. 120000/- say Rs.36000/- You will reverse this, in current year and will reduce the DAT by Rs. 36000/-
For Rs.140500/- you will be again creating the DTA of Rs.42150/-
The net effect is you DTA will increase by Rs.6150/-
I left the query open for others to reply and comment
CAclubindia
