Related Discussions

• Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction – International Accounting Standards Board

• Nov 18, 2020

• At its meeting on November 18, 2020, the IASB discussed the effective date for the amendments to IAS 12, Income Taxes. The Board also discussed due process, including permission to begin the balloting process. The Board tentatively decided that entities should apply the amendments for annual periods beginning on or after January 1, 2023, with earlier application permitted. The Board agreed that the amendments do not require re-exposure. All of the Board members confirmed they were satisfied the Board has complied with the applicable due process requirements and has undertaken sufficient consultation and analysis to begin the process for balloting the amendments. No Board member indicated an intention to dissent from the issuance of the amendments. The Board expects to issue the amendments in the second quarter of 2021.

• Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction – International Accounting Standards Board

• Oct 27, 2020

• At its meeting on October 27-29, 2020, the IASB met and discussed feedback on its Exposure Draft.  With respect to the proposed approach, the Board tentatively decided to: (i) confirm its proposal to narrow the scope of the recognition exemption in paragraphs 15 and 24 of IAS 12 Income Taxes so that it would not apply to transactions that give rise to equal amounts of taxable and deductible temporary differences; (ii) remove the capping proposal—in other words, include no requirement to limit the recognition of a deferred tax liability to the amount recognized for a deferred tax asset; (iii) provide no application guidance or examples illustrating how an entity determines whether tax deductions relate to the lease asset or lease liability; and (iv) provide an illustrative example explaining the deferred tax accounting for advance lease payments and initial direct costs. With respect to other matters, the Board tentatively decided to: (i) require entities to apply the amendments to transactions that, on initial recognition, give rise to equal amounts of taxable and deductible temporary differences. (ii) require entities already applying IFRS Standards to apply the amendments for the first time by: (a) recognizing deferred tax for all temporary differences related to leases and decommissioning obligations at the beginning of the earliest comparative period presented, with the cumulative effect recognized as an adjustment to the opening balance of retained earnings (or other component of equity, as appropriate) at that date; and (b) applying the amendments prospectively to transactions other than leases and decommissioning obligations (in other words, only to such transactions that occur on or after the beginning of the earliest comparative period presented); and (iii) require first-time adopters to recognize deferred tax for all temporary differences related to leases and decommissioning obligations at the date of transition to IFRS Standards. The Board would provide no other requirements for first-time adopters. The Board will discuss the proposed amendment’s effective date, as well as the Board’s compliance with applicable due process steps, at a future meeting.

• Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction – International Accounting Standards Board

• Apr 21, 2020

• At its meeting on April 21-23, 2020, the IASB discussed a summary of feedback on its Exposure Draft. The Board was not asked to make any decisions The Board will consider the project’s direction at a future meeting.

• Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction – International Accounting Standards Board

• Jan 23, 2019

• At its meeting on January 23, 2019, the International Accounting Standards Board (the Board) discussed the transition requirements and other particular aspects of the proposed amendments to IAS 12, Income Taxes, that Board members had raised at the October 2018 meeting. The proposed amendments would narrow the scope of the initial recognition exemption in paragraphs 15 and 24 of IAS 12. The exemption would no longer apply to the extent that, on the initial recognition of a transaction, an entity would recognize equal amounts of deferred tax assets and liabilities. The Board decided: (i) to require entities to apply the proposed amendments retrospectively applying IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors. However, entities would be permitted to assess whether the requirements in IAS 12 to recognize deferred tax assets are met only at the date of transition (transition relief); (ii) to provide transition relief to first-time adopters, i.e., first-time adopters would be permitted to assess whether the requirements in IAS 12 to recognize deferred tax assets are met only at the date of transition to IFRSs; and (iii) to permit earlier application of the proposed amendments. All 14 Board members confirmed they are satisfied that the Board has complied with the applicable due process requirements and that it has undertaken sufficient consultation and analysis to begin balloting the proposed amendments to IAS 12. The Board plans to issue an exposure draft in the second quarter of 2019.

• Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction – International Accounting Standards Board

• Oct 24, 2018

• At its meeting on October 24, 2018, the International Accounting Standards Board (the Board) discussed the IFRIC’s recommendation to propose a narrow-scope amendment to IAS 12, Income Taxes. The proposed amendment relates to the recognition of deferred tax when an entity accounts for transactions, such as leases or decommissioning obligations, by recognizing both an asset and a liability. Following a discussion, the Board tentatively decided to propose a narrow-scope amendment that would narrow the initial recognition exemption in paragraphs 15 and 24 of IAS 12 so that it would not apply to transactions that give rise to both taxable and deductible temporary differences, to the extent the amounts recognized for the temporary differences are the same.