Seminar on ‘Deferred Taxation’

Friday, 17 January 2020 00:00 -     - {{hitsCtrl.values.hits}}


The KPMG Academy has organised a seminar on ‘Deferred Taxation: Complications Stemming from the New Inland Revenue Act’ on 22 January at Hotel Ramada from 2.00 p.m to 5.00 p.m. 

The seminar will include presentations by KPMG Accounting and Advisory Services Partner Shameel Nayeem, KPMG Tax and Regulatory Principal Suresh Perer and KPMG Tax and Regulatory Director Hasna Hassan, followed by a panel discussion with Royal Ceramics Lanka PLC Head of Finance Haresh Somashantha and Commercial Bank Chief Financial Officer Nandika Buddhipala.

The seminar will cover the issues accountants face in relation to computing Deferred Tax with the introduction of the Inland Revenue Act (IRA) No. 24 of 2017 (IRA 2017). The speakers will enlighten the audience on how tax principles have been legislated in IRA 2017 which would affect the amount of Deferred Tax recorded in books. 

The methodology of tax base calculation under the Inland Revenue Act of 2017 may differ from the treatment of financial accounts, which may lead to temporary timing difference for accounting purposes; hence, the company may be required to recognise the deferred tax.

Deferred tax is the amount of income tax payable (recoverable) in future periods as a result of past transactions or events. It is inherent in the recognition of an asset or liability that a company expects to recover or settle the carrying amount of that asset or liability. If it is probable that recovery or settlement of that carrying amount will make future tax payments larger (or smaller) than they would otherwise be if such recovery or settlement were to have no tax consequences; LKAS 12 requires an entity to recognise a deferred tax liability (deferred tax asset), with certain limited exceptions.

Further, the companies are affected by tax uncertainties because the new tax act can be complex and subject to interpretation. Therefore, accounting for uncertainty in income taxes can be an area of significant judgement by the management and may also involve management estimates.

There will also be an in-depth discussion on the significance of timing differences resulting in deferred tax assets or liabilities in the financial accounts, which would be discussed together with the application of deferred tax during a tax holiday period, accounting for interest and penalties, determination of tax base, treatment for tax losses as per the new Inland Revenue Act and related deferred tax implications and uncertainty of Income Tax treatment.

For further information on the seminar and registration, please contact the KPMG Academy on tel: 011 5426 624, mobile: 077 444 6649 or email: [email protected]