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8.3 Tax base of an asset or a liability
Publication date: 31 Mar 2023
us IFRS & US GAAP guide
Under IFRS, a single asset or liability may have more than one tax base, whereas there would generally be only one tax base per asset or liability under US GAAP.
US GAAP | IFRS |
Tax base is based upon the relevant tax law. It is generally determined by the amount that is depreciable for tax purposes or deductible upon sale or liquidation of the asset or settlement of the liability.
| Tax base is based on the tax consequences that will occur based upon how an entity is expected to recover or settle the carrying amount of assets and liabilities.
The carrying amount of assets or liabilities can be recovered or settled through use or through sale.
Assets and liabilities may also be recovered or settled both through use and sale. In that case, the carrying amount of the asset or liability is bifurcated, resulting in more than a single temporary difference related to that item.
Exceptions to these requirements include:
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