Deffered tax

sir,  what is the need for provision for deffered tax ? when it is an asset ? or liability ?

plz answer to my question ....

Replies (3)

in both the cases.

sir....what is the need for providing such deffered tax????  can we get any benifit from providing such deffered tax?

The basic principle of accounting is matching principle ..i.e revene should match expenses for a period. Tax is calculated as per tax law and the same charged to profit loss account below the line. It is not right because how u can charge tax as expence some items are allowed/ disallowed/ deffered eventhough actually a business expenses.for more info.u can read as22

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