Quick income tax easonableness test for corporation tax in the income statement:

Firstly, take a gross result from the profit and loss account

Then adjust it for the permanent differences for the year/period (these are the permanently non-tax deductible items). You should add their sum  if there non-tax deductible expenses or substract if there are and non-taxable incomes,

In this way you will obtain the "nominal taxation base"

You need to multiply it by "minus 24%" (or other tax rate valid in your country

This will generate the tax at nominal rate.

If the actual tax = tax at the nominal rate, the risk of error is low. If not, you sholuld investigate why.

Find out more on this subject on:
http://24ivalue.com/module/cit/
http://24ivalue.com/pages/elearning/book/4/page/7/

Regards,
Slawomir Ekman
24iValue

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