Advanced reporting
Deferred tax calculator
Compare carrying amounts with tax bases and compute deferred tax assets and liabilities.
Tessaly Manufacturing · 31 December 2026
For each asset and liability, compare the carrying amount in the statement of financial position with its tax base. Edit the items or add your own; deferred tax is recomputed by the IAS 12 balance sheet approach.
| Item | Asset or liability | Carrying amount | Tax base | Temporary difference | Type | DTL | DTA | Remove |
|---|---|---|---|---|---|---|---|---|
| 90,000 | Taxable | 18,000 | ||||||
| 60,000 | Taxable | 12,000 | ||||||
| 8,000 | Deductible | 1,600 | ||||||
| 25,000 | Deductible | 5,000 | ||||||
| 18,000 | Deductible | 3,600 | ||||||
| Deferred tax liabilities and assets | 30,000 | 10,200 | ||||||
| Net deferred tax liability at 31 December 2026 | 19,800 | |||||||
| Net deferred tax liability at 31 December 2026 | 19,800 |
| Less: net deferred tax liability at 1 January 2026 | (16,500) |
| Deferred tax expense | 3,300 |
| Current tax expense | 41,000 |
| Total income tax expense | 44,300 |
Net deferred tax liability 19,800; the movement of 3,300 is a deferred tax expense, giving total tax expense of 44,300.
Journal entries at 31 December 2026
| Date | Account | Debit | Credit |
|---|---|---|---|
| 31 Dec | 8000Income tax expense | 41,000.00 | |
| 2040Income tax payable | 41,000.00 | ||
| Current tax for the year | |||
| 31 Dec | 8010Deferred tax expense | 3,300.00 | |
| 2600Deferred tax liability | 3,300.00 | ||
| Deferred tax: net liability moves from 16,500 liability to 19,800 | |||
Reading the signs. An asset carried above its tax base, or a liability carried below it, will create taxable amounts when recovered or settled: a taxable temporary difference and a deferred tax liability. The reverse is a deductible temporary difference and a deferred tax asset (IAS 12.15, 12.24).
Recognition caveat for deferred tax assets. A DTA is recognised only to the extent that it is probable that taxable profit will be available against which the deductible differences can be used (IAS 12.24, 12.27–31), and its carrying amount is reviewed at each reporting date (IAS 12.56). This calculator assumes that test is met. Offsetting the DTA and DTL into one net figure is permitted only with a legally enforceable right of set-off and the same taxation authority (IAS 12.74). Deferred tax on items recognised in OCI or equity is recognised there, not in profit or loss (IAS 12.61A); here every movement goes to profit or loss.
Learn it properly
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