4 1 Accounting income (loss) is the net profit or loss for a period, as reported in the statement of profit and loss, before deducting income tax expense or
Tax Accounting This service may be provided either in conjunction with record keeping and reporting or as a separate service It includes the following
It is important to understand how to account for taxation, because it has an impact on the income statement (in the tax expense account) and the balance
In cases where taxation is not based on the IFRS profit, deferred taxes will arise on the valuation difference between IFRS 17 accounting and local tax accounts
Taxable income may be significantly different from the accounting income posing problems in matching of taxes against revenue for a period Scope • Taxes on
Advocates of the liability method consider income tax expense for a period to represent the taxes paid or to be paid on the components of pretax accounting
x Integration of effective tax protection controls into computerised accounting systems x Production of satisfactory audit trails to prove revenue values by
Permanent differences do not create deferred taxes However, they do change the effective tax rate, because the basis of income tax expense is adjusted for