Accounting is a complex system in which everything is interconnected, some calculations follow from others, and the whole process is strictly regulated at the state level. There are many terms and concepts in it that are not always clear to people without a specialized education, and it is necessary to understand them in certain situations. This article considers such a phenomenon as reflection in the balance of deferred tax liabilities, what kind of phenomenon it is, for which other nuances of the issue are necessary.
Balance sheet
The concept of the balance sheet is necessary in order to proceed to the main issue of the article - deferred tax liabilities in the balance sheet. This is one of the main elements of financial statements that contains information about the property and assets of the organization, as well as its obligations to other contractors and institutions.
The balance sheet, it is the first form of accounting. reporting, presented in the form of a table, which reflects the property and debts of the organization. Each individual element is reflected in its cell with the assigned code. The codes are assigned through a special document called the “Chart of Accounts”. It is officially approved by the Ministry of Finance and is used by all organizations operating in the Russian Federation. Users of the information contained in Form No. 1 are both the organization itself and third-party interested parties, including the tax service, counterparties, banking institutions and others.
Assets and liabilities
The balance is divided into two columns: asset and liability. Each contains lines with a specific property or its source of formation. How do you know whether deferred tax liabilities in the balance sheet are an asset or a liability?
There are two groups in the balance sheet asset: current assets and non-current assets, that is, which are used in production for less than one year or more, respectively. All these are buildings, equipment, intangible assets, materials, long-term and short-term receivables.
The liability also reflects the sources of the formation of the funds listed in the asset: capital, reserves, accounts payable.
Deferred tax liabilities in the balance sheet - what is this?
In accounting, there are two concepts that are similar in name, and therefore can mislead an uninformed person. The first is a deferred tax asset (in the abbreviation IT), the second is a deferred tax liability (in the reduction of IT). Moreover, the goals and results of applying these accounting phenomena are opposite. The first phenomenon reduces the amount of taxes that the organization must pay in the following reporting periods. In this case, the amount of total profit in the reporting period will be reduced, since the payment of taxes will be more.
Deferred tax liabilities in the balance sheet is a phenomenon that causes an increase in net profit in this reporting period. This happens due to the fact that in the following periods the amount of taxes paid will be greater than in the current one. From this we conclude that deferred tax liabilities in the balance sheet are a liability, since the company uses these funds at a given time as profit, pledging to pay them in the reporting periods that follow.
How are phenomena such as IT and IT formed?
The organization simultaneously maintains several types of accounting, namely accounting, tax and management. The appearance of deferred tax assets and liabilities is associated with temporary differences in the maintenance of these accounting areas. That is, if in the accounting form of accounting expenses are recognized later than in tax, and income earlier, temporary differences in settlements appear. It turns out that a deferred tax asset is the result of the difference between the currently paid tax amount and the one calculated with a positive result. The obligation, respectively, is the difference with a negative result. That is, the company must pay taxes.
The reasons for the temporary difference in the calculations
There are several situations in which there is a temporary gap in the calculations of accounting and tax accounting. You can submit them by the following list:
- Obtaining an organization the opportunity to defer payment of taxes or installment payments.
- A company with a cash basis has charged penalties to a counterparty, but the money did not arrive on time. The same option is possible with sales proceeds.
- The financial statements show a lower amount of expenses than the tax.
- To the bang. accounting and taxation different methods of depreciation are used, as a result of which there is a difference in the estimates.
Reflection in Form No. 1
Since the obligations relate to the sources of the formation of cash and property of the organization, they relate to the liability balance sheet. In the balance sheet, deferred tax liabilities are current assets. Accordingly, in the table they are reflected in the right column. This indicator relates to the fourth section - “Long-term liabilities”. This section contains several amounts related to different sources. Each of them is assigned its own individual code, it is also called a line number. Deferred tax liabilities in the balance sheet is line 515.
Calculation and adjustments
IT are taken into account strictly in the period in which they were identified. In order to calculate the amount of liabilities, it is necessary to multiply the tax rate by the temporary taxable difference.
IT gradually disappears with a decrease in temporary differences. Information on the amount of the obligation is adjusted on the analytical accounts of the corresponding article. If the facility for which the obligation arose is retired, these amounts will not affect income tax in the future. Then they must be written off. Deferred tax liabilities in the balance sheet are account 77. That is, the transaction used to write off liabilities for tax deductible entities will look like this: 99 77. The liabilities are written off to the profit and loss account.
Calculation of net profit and current tax
Current income tax - the amount of the actual payment paid to the state budget. The amount of tax is determined based on the difference in income and expenses, adjustments to this amount, deferred liabilities and assets, as well as permanent tax liabilities (PIT) and assets (PNA). All these components add up to the following calculation formula:
TH = UD (UR) + PNO - PNA + IT - IT, where:
- TN - current income tax.
- UD (UR) - specific income (specific consumption).
This formula uses not only deferred, but also fixed assets and tax liabilities. The difference between them is that in the case of constants there are no temporary differences. These amounts are always present throughout the entire business process of the organization.
The calculation of net profit is carried out according to the formula:
PE = BP + IT - IT - VT, where:
- BP - profit recorded in accounting.
Calculation and reflection stages
To reflect all the above phenomena and procedures in accounting, certain postings are used based on the approved accounting chart of accounts. At the first stage of the formation of postings and settlements, the following operations should be reflected:
- DT 99.02.3 KT 68.04.2 - the transaction reflects the product of the turnover of the debit of the account at the tax rate - these are permanent tax liabilities.
- DT 68.04.2 KT 99.02.3 - reflects the product of the turnover of the loan at the tax rate - these are permanent tax assets.
Permanent tax assets are formed in the balance sheet if the profit according to the accounting data is higher than according to the tax. And accordingly, on the contrary, if the profit is less, tax liabilities are formed.
At the second stage of calculations, losses of the current period are reflected. It is calculated by the difference between the product of the final balance of the debit of account 99.01 to the tax rate in tax accounting and the final balance of the debit of account 09 of the accounting. Based on the foregoing, we form the wiring:
- DT 68.04.2 CT 09 - if the amount is negative.
- DT 09 CT 68.04.2 - if the amount is with a positive sign.
At the third stage of calculations, the sums of deferred tax liabilities and assets are calculated taking into account temporary differences. To do this, it is necessary to determine the balance of taxable differences in general, calculate the balance at the end of the month, which should be reflected in accounts 09 and 77, determine the total amounts for the accounts, and then adjust them according to the calculations.