Hi Sir,
Can anybody tell me what is deffered Tax Asset and deffered Tax Liability.
How it is created and treated in Accounts
Thanks in advance
Rajesh
Rajesh Kumar (Student) (211 Points)
03 December 2008Hi Sir,
Can anybody tell me what is deffered Tax Asset and deffered Tax Liability.
How it is created and treated in Accounts
Thanks in advance
Rajesh
CA Trinath Galla
(student)
(3130 Points)
Replied 03 December 2008
Hi Rajesh
I think as u no
we calculate depreciation on assets of a company as per companies act for accounting purposes
n later when paying income tax we calculate depreciation for the same as per Income Tax act
the depreciation arrive for both the purposes may(will) differ
and the result asset/liability should be shown accordingly in balance sheet
N if the depreciation as per Companies act is more than IT act, The balancing amount should be maintained as Deffered Tax asset
And if Depriciation as per IT act is more dan the Companies act, the balancing amount should be maintained as Deffered tax liability
CAclubindia
