deferd tax liability



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What is deferd tax liability?

2 Answer(s)


1

An account on a company's balance sheet that is a result of temporary differences between the company's accounting and tax carrying values, the anticipated and enacted income tax rate, and estimated taxes payable for the current year. This liability may or may not be realized during any given year, which makes the deferred status appropriate.

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Deferred Tax Liability arises due to a difference in the Tax Liability between the companies Profit as per the P&L account and the Income Tax Act that is generally caused due to the difference in the rate of depreciation.

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