Tax Accrual
/ˈtæks əˈkruːəl/
Definitions
- (n.) An accounting entry reflecting the amount of tax liability or asset recognized for financial reporting before actual payment or receipt.
The company recorded a tax accrual for its estimated income tax expense at the end of the fiscal year.
Forms
- tax accrual
- tax accruals
Related terms
See also
Commentary
Tax accruals are critical in financial statements to match tax expense with the period in which the related income is earned, ensuring accuracy under accrual accounting rules.
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.