In the same period as the assumed utilization of tax loss carried forward.The trick is to look at your current taxable temporary differences and see if they relate: The thing is that you do not necessarily need to generate sufficient taxable profits in the future.

Do you assume sufficient future taxable profit against which the unused tax loss can be offset? If you do not assume to pass through these restrictions, then do NOT recognize a DTA.

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The standard IAS 12 says in the paragraphs 24 and 34 that yes, you should recognize a deferred tax asset (DTA) for unused tax losses (or tax credits) carried forward, to the extent that it is probable that future taxable profits will be available. Good question and I agree that it may create some confusion. However, when the company makes loss continuously in the consecutive years, can they be carried forward and should the deferred tax asset be recognized? How? In some countries, tax legislation permits offsetting the tax losses of the company against the future tax profits.įor example, the tax loss not fully deducted in the year 1 can be carried forward and set off against the profits in the next three consecutive years.

Deferred tax calculation excel