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Chapter 9

Step (3) Post the movement in the deferred tax balance

Only the movement in the provision is posted in any accounting
period.

Look out for brought forward deferred tax balances.

Assuming increases in deferred tax, the journals required are:

Dr P/L Dr Deferred tax asset

Cr Deferred tax liability Cr P/L

The deferred tax entry should match the treatment of the
transaction causing deferred tax.

e.g. Capital allowances to P/L, revaluations to OCI

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