IAS 12 INCOME TAXES

Question 1

Current tax

Answer 1

the amount of tax due to or from the tax authorities for a period.

Question 2

Accounting profit:

Answer 2

Accounting profit is profit or loss for a period before deducting tax expense.

Question 3

Taxable profit:

Answer 3

Taxable profit (or tax loss) is the profit (or loss) for a period, determined by the taxation authorities, based on the income and expenses that are included or excluded for tax purposes

Question 4

Tax base

Answer 4

the value of an asset or liability in terms of the tax laws.

Question 5

Temporary differences

Answer 5

differences between the carrying amount of an asset or liability in SOFP and its tax base.

Question 6

Deductible TD

Answer 6

result in deductible amounts in determining taxable profit (or tax loss) of future periods when the carrying amount of the asset or liability is recovered or settled.

Question 7

Taxable TD

Answer 7

result in taxable amounts in determining taxable profit (or tax loss) of future periods when the carrying amount of the asset or liability is recovered or settled.

Question 8

Deferred tax assets

Answer 8

Deferred tax assets are the amounts of income taxes recoverable in future periods in respect of:

(a) deductible temporary differences
(b) the carryforward of unused tax losses, and
(c) the carryforward of unused tax credits

deferred tax assets = deductible temporary differences * tax rate + unused tax losses * tax rate and tax credits

Question 9

Deferred tax liabilities

Answer 9

Deferred tax liabilities are the amounts of income taxes payable in future periods in respect of taxable temporary differences.

Question 10

Tax Expense/Tax Income

Answer 10

= Current tax + Deferred Tax