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MAT and Deferred tax.

This query is : Resolved

Guest

Guest (Querist)

01 March 2011 Hi everybody,
Thanks for answering in advance.

I wish to understand the logic behind using normal tax rates for creating deferred tax liability.

Why not create DTL at MAT rates, since MAt is the effective current tax. Thnaks a lot

CA Punit

CA Punit (Expert)
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01 March 2011 MAT is not effective current tax its the MINIMUM amount of tax that should be PAID.

Effective & Actual tax liability is at normal rates.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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01 March 2011 It is a bench mark as specified in AS-22 for maintaining uniformity and consistency while preparing financial statements.

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