What is deferred income tax and its accounting treatment?

Deferred income tax is the influence of timing difference on income tax, and only under the tax impact accounting method will deferred tax be generated. It is the amount that affects (reduces) future income tax payable according to deductible temporary differences and applicable tax rates. Deferred income tax assets and deferred income tax liabilities are two accounting subjects, which are placed in the asset column and the liability column respectively. However, they are different from traditional assets and liabilities to some extent, but their accounting contents are similar to those of assets and liabilities, so these two accounting subjects are used to account for some special economic businesses.

Accounting treatment of deferred income tax assets and liabilities;

1, the actual income tax payable according to the profits of the enterprise.

Debit: income tax expense

Loan: Taxes payable-enterprise income tax

2. Deferred income tax assets are income tax expenses affected by the existence of tax differences.

Debit: deferred income tax assets

Credit: income tax expense

3 income tax affected by deferred income tax liabilities

Debit: income tax expense

Credit: deferred income tax liabilities

The above three items add up to

Debit: income tax expense

deferred income tax assets

Loan: Taxes payable-enterprise income tax

deferred income tax liabilities

The main accounting treatment methods of deferred income tax assets are as follows:

1. Deferred income tax assets that an enterprise should recognize in accordance with the income tax standards when recognizing related assets and liabilities,

Second, on the balance sheet date, if the deferred income tax assets that the enterprise should confirm according to the income tax standards are greater than the balance of the account, it will debit the account and credit the accounts such as "income tax-deferred income tax expenses" and "capital reserve-other capital reserves"; If the deferred income tax assets to be confirmed are less than the balance of this account, the opposite accounting entry will be made.

3. On the balance sheet date, if it is estimated that sufficient taxable income may not be obtained in the future to offset the deductible temporary differences, the subjects of "income tax-current income tax expenses" and "capital reserve-other capital reserves" shall be debited according to the write-down amount and credited to this subject.

Four, the final debit balance of this course, reflecting the balance of deferred income tax assets confirmed by the enterprise.