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  • Corporation Tax Liquidation Scheme 2

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    Lisa Weng zhang
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    The corporation tax liquidation process involves first determining the profit or loss result and making any corrections between accounting and tax rules. The taxable base is then calculated before applying any capitalization or compensation reserves from previous years. The taxable base is multiplied by the tax rate to determine the tax amount, which is then adjusted for any deductions or incentives to arrive at the final liquid tax amount owed or refunded.

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    The corporation tax liquidation process involves first determining the profit or loss result and making any corrections between accounting and tax rules. The taxable base is then calculated before applying any capitalization or compensation reserves from previous years. The taxable base is multiplied by the tax rate to determine the tax amount, which is then adjusted for any deductions or incentives to arrive at the final liquid tax amount owed or refunded.

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    6 views3 pages

    Corporation Tax Liquidation Scheme 2

    Uploaded by

    Lisa Weng zhang
    The corporation tax liquidation process involves first determining the profit or loss result and making any corrections between accounting and tax rules. The taxable base is then calculated before applying any capitalization or compensation reserves from previous years. The taxable base is multiplied by the tax rate to determine the tax amount, which is then adjusted for any deductions or incentives to arrive at the final liquid tax amount owed or refunded.

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    © All Rights Reserved
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    of 3

    CORPORATION TAX LIQUIDATION PROCESS

    RESULT OF THE PROFIT AND LOSS ACCOUNT


    (Positive or Negative)

    Plus and minus


    Corrections due to Increases
    differences between (Positive corrections to
    accounting principles P/L result)
    applied and tax rules

    TAXABLE BASE BEFORE CAPITALIZATION


    RESERVE AND COMPENSATION OF NEGATIVE
    TAXABLE BASES OF PREVIOUS YEARS

    Minus
    CAPITALIZACION RESERVE

    Minus
    COMPENSATION NEGATIVE TAXABLE BASES

    Only small companies Plus or minus


    NIVELATION RESERVE

    TAXABLE
    BASE

    TAX RATE (Usually 25%)

    TAX AMOUNT

    DEDUCTIONS (including double taxation)

    ADJUSTED TAX AMOUNT (if positive)

    minus
    Deductions for incentives and certain
    investments (e.g. R+D)

    POSITIVE LIQUID TAX AMOUNT

    minus
    Witholdings and payments on account
    AMOUNT TO PAY OR REFUND
    SS

    Decreases
    (Negative corrections to
    P/L result)

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