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Hi,
Is the tax base of an asset/liability something we have to calculate or will it be given in a question?
Also, I’m confused as to when is the tax base of an asset/liability 0?
Thank you.
Hi,
You would need to calculate it.
The tax base would be zero when the tax authorities have not recognised anything in the mock financial statements, primarily because the money has already been spent or has already been received, or where full allowance has been given for the expenditure incurred as is with investment in R&D
If you give me specific examples of where you see the tax base is zero then I can help in more detail.
Thanks
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