What is a Deferred Tax Asset (DTA)?
A DTA arises when there are temporary differences between the accounting and tax treatment of certain expenses or provisions. In the case of labor liabilities, this occurs because:
- Provisions for employee benefits (such as severance or employer retirement) are recognized for accounting purposes but are only deductible for tax purposes when they are actually paid.
This creates a temporary taxable or deductible difference, leading to the recognition of a DTA, which reflects the tax the company will pay or avoid paying in the future.
Why is it important to recognize a DTA correctly?
- Optimizes tax burden: Allows for more efficient planning of income tax at the end of each fiscal year.
- Compliance with IFRS: A DTA is mandatory under international accounting standards when the company has provisions for employee benefits.
- Transparency and control: Provides a clearer view of the organization’s future tax position.
Recommendations for Properly Managing a DTA
- Conduct an accurate actuarial valuation of all employee benefits, such as severance and employer retirement.
- Apply the current income tax rate to temporary differences.
- Periodically assess the recoverability of the DTA, especially if there are accumulated tax losses.
- Include the DTA in your financial reports and internal audits as technical support for regulatory authorities.
📞 Does your company already recognize its DTA correctly?
At VOLRISK, we help you identify, calculate, and accurately record Deferred Tax Assets arising from labor liabilities, with the technical support of our certified actuaries.
Receive clear, professional advice fully aligned with local and international accounting standards.
📧 Write to us at: infoec@volrisk.com
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