Is your company ready for FRS 102? – Deferred Tax


Part 3- Deferred Tax

The changes under FRS 102 will result in more instances where deferred tax must be accounted for. Deferred tax will be recognised based on a “timing differences plus” approach. This is quite similar to the “timing difference” approach in use under GAAP but builds on this by adding some requirements and eliminating some exemptions previously allowed under GAAP. Deferred tax will now be recognised on assets and liabilities arising on a business combination (not including goodwill). Deferred tax will now be provided in respect of non-depreciable property whose value has been measured using the revaluation model (FRS 19 allowed an exception to this). Deferred taxes cannot be discounted under FRS 102 (FRS 19 allowed a policy choice of discounting to present value).

What questions do you have?

We are happy to help. Please post your comment below or contact our friendly and knowledgeable team on 01 677 9000.  To keep in touch, connect with us on Linkedin. If this article helped you, please share it with other businesses.