68
STAMFORD LAND CORPORATION LTD
Notes to Financial Statements
2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
(v)
Income tax
Current and deferred income taxes are recognised as income or expense in profit or loss, except to the
extent that the tax arises from a business combination or a transaction which is recognised directly in
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Current income tax for current and prior periods is recognised at the amount expected to be paid
to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or
substantively enacted by the balance sheet date.
Deferred income tax is recognised for all temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements except when the deferred
income tax arises from the initial recognition of goodwill or an asset or liability in a transaction that
is not a business combination and affects neither accounting nor taxable profit or loss at the time
of the transaction. Deferred tax arising from a business combination is adjusted against goodwill on
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Deferred income tax is recognised on temporary differences arising on investments in subsidiaries,
except where the Group is able to control the timing of the reversal of the temporary difference and it
is probable that the temporary difference will not reverse in the foreseeable future. A deferred income
tax asset is recognised to the extent that it is probable that future taxable profit will be available against
which the deductible temporary differences and tax losses can be utilised. Deferred tax assets are
reviewed at each balance sheet date and are reduced to the extent that it is no longer probable that
the related tax benefit will be realised.
Deferred income tax is measured:
(i)
at the tax rates that are expected to apply when the related deferred income tax asset is realised
or the deferred income tax liability is settled, based on tax rates and tax laws that have been
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at the balance sheet date, to recover or settle the carrying amounts of its assets and liabilities
except for investment properties. Investment property measured at fair value is presumed to
be recovered entirely through sale.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax
liabilities and assets, and they relate to taxes levied by the same tax authority on the same taxable
entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis
or their tax assets and liabilities will be realised simultaneously.
