Answer-Which of the following reduces a company’s taxable income immediately (current tax) but increa...

Higher tax depreciation reduces current taxable income lower current tax payable. However, it creates a taxable temporary difference because the book value of the asset is higher than its tax base, leading to a Deferred Tax Liability DTL.

Question

Which of the following reduces a company’s taxable income immediately (current tax) but increases deferred tax liability?

A Depreciation for tax higher than book depreciation (accelerated tax depreciation)

B Provision recognised in books but not deductible for tax

C Revenue recognised for tax but not in books

D Member contribution to provident fund

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Which of the following reduces a company’s taxable income immediately (current tax) but increases deferred tax liability?

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