Australian Accounting Alert on tax consolidation
04 Apr 2005
Deloitte (Australia) has published an Australian Accounting Alert covering a new Australian interpretation, (PDF 49k).
The effect of the interpretation is as follows:
- each entity in the tax-consolidated group recognises its own deferred tax balances and income tax expense;
- the head entity recognises the group's aggregate current tax liability and the benefit of any tax losses arising in the tax-consolidated group; and
- where amounts payable under any tax-funding agreement that is in place do not mirror these requirements, the net difference is treated as an equity transaction.