EN
L 237/980
Official Journal of the European Union
26.9.2023
IFRIC INTERPRETATION 23
Uncertainty over Income Tax Treatments REFERENCES
— IAS 1 Presentation of Financial Statements — IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors — IAS 10 Events after the Reporting Period — IAS 12 Income Taxes BACKGROUND
1.
IAS 12 Income Taxes specifies requirements for current and deferred tax assets and liabilities.
An entity applies the requirements in IAS 12 based on applicable tax laws.
2.
It may be unclear how tax law applies to a particular transaction or circumstance.
The acceptability of a particular tax treatment under tax law may not be known until the relevant taxation authority or a court takes a decision in the future.
Consequently, a dispute or examination of a particular tax treatment by the taxation authority may affect an entity's accounting for a current or deferred tax asset or liability.
3.
In this Interpretation: (a) ‘tax treatments’ refers to the treatments used by an entity or that it plans to use in its income tax filings.
(b) ‘taxation authority’ refers to the body or bodies that decide whether tax treatments are acceptable under tax law.
This might include a court.
(c) an ‘uncertain tax treatment’ is a tax treatment for which there is uncertainty over whether the relevant taxation authority will accept the tax treatment under tax law.
For example, an entity's decision not to submit any income tax filing in a tax jurisdiction, or not to include particular income in taxable profit, is an uncertain tax treatment if its acceptability is uncertain under tax law.
SCOPE
4.
This Interpretation clarifies how to apply the recognition and measurement requirements in IAS 12 when there is uncertainty over income tax treatments.
In such a circumstance, an entity shall recognise and measure its current or deferred tax asset or liability applying the requirements in IAS 12 based on taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates determined applying this Interpretation.
ISSUES
5.
When there is uncertainty over income tax treatments, this Interpretation addresses: (a) whether an entity considers uncertain tax treatments separately; (b) the assumptions an entity makes about the examination of tax treatments by taxation authorities; (c) how an entity determines taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates; and (d) how an entity considers changes in facts and circumstances.