An effort to depreciate a property based on the lives of individual assets within it, allowing for more accurate allocation of expense over time compared to composite depreciation.
Deferred taxation refers to the sum set aside for tax in the accounts of an organization that will become payable in a period other than the one under review. It arises due to timing differences between tax rules and accounting conventions.
Safekeeping, usually by banks, of securities held on behalf of clients, with comprehensive services spanning markets and securities in multiple countries.
An essential financial term representing the profits of a company that are subject to corporation tax, adjusted for allowable deductions.
An accounting method used to report income from long-term contracts based on the percentage of contract completion during the tax year.
A permanent difference refers to a discrepancy between profits or losses calculated for tax purposes and those reported in the financial statements. For example, certain expenses may be included in financial statements but not allowed as deductions for tax purposes.
Prepaid income refers to rents, interest, or other forms of compensation received in advance for services or deliveries to be provided at a later date. It is generally included in taxable income in the year it is received.
Pretax income, also known as earnings before tax (EBT), represents the amount of income earned from business or investments before the deduction of any applicable income taxes.
A company within a group of companies responsible for accounting for both output and input tax for value-added tax (VAT) purposes, and ensuring the quarterly VAT return for the group is submitted. All companies in the group share joint and several liability for any VAT due.
The Sum-of-the-Years'-Digits (SYD) method is an accelerated depreciation technique that allows for higher depreciation expenses in the earlier years of an asset's life and lower expenses as the asset ages.
Tax accounting is an accounting specialization focusing on tax preparation, compliance, and planning. It involves the application of accounting principles to adhere to tax laws and accurately report tax-related information.
A financial loss incurred by an organization that can be carried forward to subsequent periods to reduce the tax payable in those periods.
Uniform Capitalization Rules (UNICAP) are a set of tax accounting principles governing the capitalization of direct and indirect costs to property produced by taxpayers or acquired for resale. Established under the Tax Reform Act of 1986, these rules aim to ensure consistent decision-making regarding inventory cost allocation, leading to more accurate financial reporting and tax compliance.
Written-down value (WDV) is the value of an asset for tax purposes after accounting for reduction in value below the initial cost due to its use in trade. It indicates the remaining value of the asset after appropriate capital allowances.
Zero-rated goods and services are taxable for value-added tax (VAT) purposes but are currently subject to a tax rate of zero. In contrast to exempt supplies, VAT attributable to zero-rated supplies is allowable for input tax credit.
