Tax expense

In Tax calculation -Tax expense, you see the calculation of This year’s tax base, Tax expense income statement and Tax payable balance sheet.

Tax calculation starts with Ordinary profit before tax expense. In order to arrive at This year’s tax base, the result is adjusted for intra-group contributions, permanent differences, this year’s changes in temporary differences and loss carryforward.

Payable income taxes is calculated by multiplying the This year’s tax base with the year's tax rate.

Tax expense income statement is distributed on Payable income taxes and Changes in deferred tax. In addition, Insufficient / too much tax provision in previous years and Tax intra-group contribution are also taken into account.

Insufficient / too much deferred tax in previous years is automatically processed by the system as a correctional item to the tax payable this year. This is done in the closing entry for payable tax. A debit balance on the account Tax payable, not determined, before calculating the estimated taxes for the year, will automatically be recorded as an expense. A credit balance is automatically deducted from the estimated taxes for the year.

Tax payable balance sheet consists of tax payable on the year’s result, deduction of subsidies hoards and tax effect of group contributions. Paid taxable intra-group contribution is recorded directly in the balance sheet and reduces payable tax for the donor (as allocation of the result when intra-group contribution is paid to a parent or affiliated company, and when it is recorded as increased acquisition cost of shares for intra-group contributions paid from parent company to subsidiary). When an item affects payable tax directly in the balance sheet, tax payable balance sheet shows a different amount than payable tax, tax expense.

The closing entry Payable tax is automatically updated.

Values for previous year ​​are entered manually.

Tax expense is transferred to the calculation on the left hand side. Approve the tax calculation by clicking on the status symbol in the column Done.