There are 2 types of differences between Profit as per books(tally) and Taxable Profit

Timing Difference (TD)
Permanent Difference(PD)

Timing Difference  Permanent Difference
These adjust in future These do no adjust in future
We make DTA/DTL for the same We do not make DTA /DTL
   
Example Example
Difference in Depreciation rates as per Companies ACT AND income Tax 1. Illegal Expense Disallowed

2 Section 40(A)

30% Of Expense On Which Tds Not Deposited Allowed In Year When Actually Deposited)

 2. Personal Expenses Disallowed

3. Section 43B

Interest On Bank Loan/Bonus/Pf Not Paid Till Return Filing Date 30 Sept,If Paid After 30 Sept,Allowed Next Year

 

 

  1. Accounts and Finance
  2. Step 4 Balance Sheet Finalization Procedure
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CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 8 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com .