Preparing your first IFRS based tax returns - Part I
IFRS Watch - Issue 2
Enough to make tax accountants of listed companies especially banks and other financial institutions (with mandatory 31 December year end) nervous is the compulsory financial reporting based on International Financial Reporting Standards (IFRS) kicking off for the first time this year end. Coupled with this, is the requirement to file tax returns based on these new financial statements also for the first time.
The new self-assessment regulation gives little room for settlement of tax liability after the tax filing deadline. With the complexities involved in preparing IFRS financial statements and the tax accounting/ provisioning aspects, it is recommended that companies with 31 December year end commence their tax computations process urgently. Once the tax provisions are ready (even if they are based on draft accounts), companies can commence payment from January ending, settling by monthly installments until the final accounts are ready for filing, and before the deadline date.