In the current version of UK GAAP taxation is dealt with in two accounting standards: FRS 16 Current Tax and FRS 19 Deferred Tax, explains Steve Collings.
Aspects concerning taxation are also found in FRS 17 Retirement Benefits (specifically paragraphs 71 and 72) which deal with tax relief on a company’s pension contributions and the attribution of the tax effects to the profit and loss account and statement of total recognised gains and losses.
FRS 102 deals with taxation in Section 29 Income Tax. The scope paragraph of Section 29 confirms that income tax (for the purposes of FRS 102) includes all domestic and foreign taxes which are based on taxable profit. It then goes on to include taxes such as withholding taxes payable by a subsidiary, associate or joint venture within its scope.
Unlike FRS 16 and FRS 19 currently, Section 29 combines...
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- Current tax
- Deferred tax
- Timing difference ‘plus’
- Measurement of deferred tax
About Steven Collings
Steve Collings, FMAAT FCCA is the audit and technical partner at Leavitt Walmsley Associates Ltd where Steve trained and qualified.