IASB clarifies the accounting for deferred tax on leases and decommissioning obligations

May 7, 2021 – Amendments have been issued to IAS 12 – the IFRS standard on income taxes.

IAS 12 Income Taxes
IAS 12 Income Taxes specifies how firms account for income tax, including deferred tax. Exemptions sometimes apply when recognizing assets or liabilities for the first time. There is uncertainty about whether an exemption applies to leases and decommissioning obligations: transactions for which companies recognize both an asset and a liability.

Clarifies the exemption does not apply and that firms are required to recognize deferred tax. Aims to reduce diversity in deferred tax reporting on leases and decommissioning.

Effective for annual reporting periods from January 1, 2023 with early application permitted.

For more information, visit www.ifrs.org.

Discover More Regulatory Insights

Visit the AxiomSL resource center for recent Regulatory Changes for financial institutions, InsideView Blog, and Thought Leadership.

We use cookies in order to give you the best possible experience on our website. By continuing to use this site, you agree to our use of cookies.