Rules for determining tax base

The tax base under IFRS is defined by one of four rules. These are:

1. •

   the tax base of an asset is the amount that will be deductible for tax purposes against any taxable economic benefits that will flow to an entity when it recovers the carrying amount of the asset, or

2. •

   if those economic benefits will not be taxable, the tax base of the asset is equal to its carrying amount (ie there is no temporary difference). See Example 3