The amount (on an entity’s books) that is attributed to a liability for tax purposes. It constitutes the carrying amount of the liability less any tax-deductible amounts (deductible for tax purposes) relating to that very liability in the future. It is the amount at which a liability would appear on a tax-based balance sheet.
Any differences between the carrying amount and tax base of liabilities (as well as any differences between carried forward tax losses and credits) are typically recognized as deferred tax liabilities (or deferred tax assets, depending on the difference direction).
Comments