The reason for the deductible temporary difference

Deductible temporary differences generally arise from the following:

The carrying amount of an asset is less than its tax basis.

When the book value of an asset is less than its tax base, from the perspective of economic meaning, the economic benefit generated by the asset in the future period is small, and the amount allowed to be deducted before tax in accordance with the provisions of the tax law is large, then the enterprise can reduce the taxable income and reduce the income tax payable in the future period for the difference between the book value and the tax base, and when the relevant conditions are met, the relevant deferred tax assets should be recognized.

For example, if the carrying amount of an asset is $2 million and the tax basis is $2.6 million, the enterprise can deduct an additional $600,000 from the asset in the future period on top of its own economic benefits. On the whole, the taxable income in the future period will be reduced, and the income tax payable will also be reduced, resulting in a deductible temporary difference, and the relevant deferred tax assets should be recognized when the recognition conditions are met.

The carrying amount of the liability is greater than its tax basis.

When the carrying amount of a liability is greater than its tax base, the temporary difference arising from the liability is essentially the amount that can be deducted before tax in future periods as stipulated by the tax law. That is, temporary differences arising from liabilities = book value - tax basis = book value - (book value - amount that can be deducted before tax in accordance with the tax law in future periods) = the amount that can be deducted before tax in accordance with the tax law in future periods.

The carrying amount of a liability is greater than its tax basis, which means that all or part of the expenses related to the liability in future periods in accordance with the provisions of the tax law can be deducted from the future taxable economic benefits, reducing the taxable income and income tax payable in future periods.

For example, an enterprise recognizes an estimated liability of RMB 2 million for the product warranty expenses that will be incurred in the current period of sales, but the tax law stipulates that the relevant expenses can only be deducted before tax when they are actually incurred, and the tax basis is 0; The relevant expenses of the current period in which the enterprise recognizes the estimated liabilities are not allowed to be deducted before tax, but the relevant expenses in the following period are allowed to be deducted before tax, so that the taxable income and income tax payable in the future period are reduced, resulting in a deductible temporary difference, and the relevant deferred tax assets should be recognized when the relevant recognition conditions are met.

Determining the amount of taxable income for the period of future recovery of assets or liquidation of liabilities will result in a temporary difference in the amount of deductions.

A deductible temporary difference refers to a temporary difference that will result in a deductible amount of deductible compensation when determining the taxable income during the period of future recovery of assets or liquidation of liabilities.

A deductible temporary difference is the difference between the carrying amount of an asset or liability on a balance sheet and its tax basis as defined by the tax law.

Book value refers to the amount of relevant assets and liabilities that should be listed in the balance sheet determined in accordance with the provisions of the Accounting Standards for Business Enterprises. The tax basis refers to the amount attributable to the assets and liabilities when calculating tax according to the provisions of the tax law, that is, the actual value of assets and liabilities.

A deductible temporary difference refers to a temporary difference that will result in a deductible amount when determining the taxable income during the future recovery of assets or the settlement of liabilities.

A deductible temporary difference is a temporary difference that will result in a deductible amount when determining the taxable income during the future recovery of assets or liquidation of liabilities. In the current period when the deductible temporary difference arises, the relevant deferred tax assets shall be recognized when the conditions for recognition are met. Wide merger.

The accounting treatment of deductible temporary differences is: debit: income tax expense, deferred tax assets, credit: payable tax and enterprise income tax.

How to understand deductible temporary differences, for example: the provision for the reduction of the value of assets accrued in accounting is considered to be a loss in accounting, but the tax law does not recognize the impairment loss accrued, so there is a deductible temporary withering difference between the two, and the income should be increased by tax when calculating the taxable income of the current period when filing tax returns; When disposing of other assets, the deductible temporary difference is reversed, and the impairment provision that was not guessed in the original provision is allowed to be deducted before tax because it actually occurred, but it does not reduce the accounting profit of the current period, so when calculating the taxable income, the tax adjustment and reduction treatment should be made.

Temporary differences refer to the carrying amount of the liabilities of the asset or the first force.

and its tax basis.

the difference between the two.

A deductible known temporary difference is the amount of taxable income during the determination of future recovery of assets or liquidation of liabilities.

, which will result in a temporary difference in the deductible amount.

Deductible temporary differences generally arise from the following:

1. The book value of assets is less than its tax base, 2. The book value of liabilities is greater than its tax base.