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defined benefit scheme

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › defined benefit scheme

  • This topic has 1 reply, 2 voices, and was last updated 4 years ago by Stephen Widberg.
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  • July 28, 2021 at 4:35 am #629617
    Noah098
    Member
    • Topics: 935
    • Replies: 352
    • ☆☆☆☆☆

    sir can you explain the deferred tax implications relating to defined benefit scheme?

    I understand that in case of defined contribution scheme, any accrued pension contribution will lead to a DT asset.

    but am not sure how DT asset/liability can possibly arise in a defined benefit scheme

    July 28, 2021 at 5:35 pm #629694
    Stephen Widberg
    Keymaster
    • Topics: 16
    • Replies: 3427
    • ☆☆☆☆☆

    If you have a net liability in the SFP (which is usual) you will have a DT asset.

    Usually because service and net interest costs (in P&L0 exceed contributions paid (allowed for tax).

    You will be told the tax rules in the exam.

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