Garvenne has recorded tax losses over the last three years; it has 800,000 of losses carried forward. Its taxable differences with the same authority and entity, which will reverse before expiry, amount to 220,000. Its budget forecasts a strong recovery, but management concludes, after a documented analysis (judgement in the case), that it is not convincing evidence. Tax rate: 25%. Compute the asset and the losses to be disclosed with no asset.
- Losses carried forward
- 800,000
- Taxable differences reversing before expiry
- 220,000
- Tax rate (%)
- 25 %