Page 231 - F2 Integrated Workbook STUDENT 2019

Deferred tax

(3) Deferred tax on share options

 Per IFRS 2, share options reduce profits each year from the grant date to the
vesting date.

 For tax purposes, no relief is given until the options are exercised (based on the
intrinsic value of the option).

 Creates a DEFERRED TAX ASSET.

Illustrations and further practice

Now work through illustration 2 from Chapter 9 of the study text.

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