Deferred Taxes
Taxes that have been accrued but not yet paid, often considered during the due diligence process to assess future tax liabilities.
Implications
Taxes that are accrued in the current period but are payable in a future period, often arising from differences between accounting practices and tax regulations, important for managing cash flow and financial planning.
Example
Example: A corporation reports deferred taxes due to differences in depreciation methods for tax and financial reporting purposes, recognizing a liability that will be paid when the tax depreciation catches up with financial depreciation.
Related Terms
Different from current taxes, which are paid within the current period, deferred taxes represent a future tax obligation or asset that is recognized in the current financial statements.
Get INSTANT comprehensive market research of any industry
Chat with AII Consultant Now!
