Corporation Tax

FRS 102 ― tax reconciliation disclosures

Produced by Tolley in association with Malcolm Greenbaum
  • 30 Mar 2022 10:33

The following Corporation Tax guidance note Produced by Tolley in association with Malcolm Greenbaum provides comprehensive and up to date tax information covering:

  • FRS 102 ― tax reconciliation disclosures
  • Introduction
  • Examples of reconciling items

FRS 102 ― tax reconciliation disclosures


FRS 102 requires a note to the financial statements that reconcile:

  1. the total tax expense (income) included in profit or loss, and

  2. the profit or loss on ordinary activities before tax multiplied by the ‘applicable tax rate’

FRS 102, s 29.27(b)

This allows users to understand the reasons why the actual tax expense is not equal to the profit before tax figure multiplied by the corporation tax rate in force at the reporting date.

‘Applicable tax rate’ is not defined by FRS 102. The same phrase is, however, used in International Financial Reporting Standard IAS 12:

Income Taxes: …an entity uses an applicable tax rate that provides the most meaningful information to the users of its financial statements. Often, the most meaningful rate is the domestic rate of tax in the country in which the entity is domiciled, aggregating the tax rate applied for national taxes with the rates applied for

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