Deferred Tax
/dɪˈfɜːrd tæks/
Definitions
- (n.) A tax liability or asset recognized in accounting to reconcile differences between tax base and accounting base of assets or liabilities, deferring tax payments to future periods.
The company recorded a deferred tax liability due to temporary differences in asset depreciation.
Forms
- deferred tax
Related terms
See also
Commentary
Deferred tax concepts are crucial in financial and tax accounting to reflect timing differences; precise drafting should distinguish deferred tax liabilities from current tax liabilities to avoid misinterpretation.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.