scholarly journals Early closeout of derivatives in the light of corporate income tax

2017 ◽  
Vol 0 (0) ◽  
Author(s):  
Łukasz Karczyński
Keyword(s):  
Financial Crisis ◽  
Income Tax ◽  
Corporate Income Tax ◽  
Currency Options ◽  
Forward Contracts ◽  
Taxable Income ◽  
The Third ◽  
Legal Provisions ◽  
The Law ◽  
Proper Interpretation

Abstract Due to financial crisis many entrepreneurs suffered heavy losses on derivatives, mainly currency options and forward contracts. Tax authorities tend to disallow deduction of those losses from the taxable income. Many cases ended up in administrative courts, resulting in judicature controversies on the issue in question. This paper is the third of four in a cycle. The aim of the whole cycle is to analyze deeply these controversies and suggest the proper interpretation of the legal provisions, determining whether the expenses on currency options and forward contracts should or should not be regarded as tax-deductible expenses. The aim of this paper is to determine if the rights from the derivatives are being exercised or waived (as the law provides) in case of their early closeout (which allows the deduction as well). The conducted analysis suggests that early derivative closeout realises in exercising the rights from the derivative (as the law provides), which allows the deduction.

scholarly journals Early closeout of derivatives in the light of corporate income tax

2016 ◽  
Vol 1 (3) ◽  
pp. 51-59
Author(s):  
Łukasz Karczyński
Keyword(s):  
Financial Crisis ◽  
Income Tax ◽  
Corporate Income Tax ◽  
Currency Options ◽  
Forward Contracts ◽  
Taxable Income ◽  
The Third ◽  
Legal Provisions ◽  
The Law ◽  
Proper Interpretation

Abstract Due to financial crisis many entrepreneurs suffered heavy losses on derivatives, mainly currency options and forward contracts. Tax authorities tend to disallow deduction of those losses from the taxable income. Many cases ended up in administrative courts, resulting in judicature controversies on the issue in question. This paper is the third of four in a cycle. The aim of the whole cycle will be to analyze deeply these controversies and suggest the proper interpretation of the legal provisions, determining whether the expenses on currency options and forward contracts should or should not be regarded as tax-deductible expenses. The aim of this paper is to determine if the rights from the derivatives are being exercised or waived (as the law provides) in case of their early closeout (which allows the deduction as well). The conducted analysis suggests that early derivative closeout realises in exercising the rights from the derivative (as the law provides) which allows the deduction.

scholarly journals Loss on „Toxic” Currency Options and Forward Contracts as a Tax-Deductible Expense in Corporate Income Tax – General Issues

2016 ◽  
Vol 1 (1) ◽  
pp. 11-22
Author(s):  
Łukasz Karczyński
Keyword(s):  
Financial Crisis ◽  
Income Tax ◽  
Corporate Income Tax ◽  
Currency Options ◽  
Forward Contracts ◽  
Taxable Income ◽  
Legal Provisions ◽  
Administrative Courts ◽  
Legal Character ◽  
Proper Interpretation

Abstract Due to financial crisis many entrepreneurs suffered heavy losses on currency options and forward contracts. Tax authorities tend to disallow deduction of those losses from the taxable income. Many cases ended up in administrative courts, resulting in judicature controversies on the issue in question. This paper is the first of four in a cycle. The aim of the whole cycle will be to analyze deeply these controversies and suggest the proper interpretation of the legal provisions, determining whether losses on currency options and forward contracts should or should not be regarded as tax-deductible expenses. The aim of this paper is to determine the scope of the problems to solve as well as to analyze the legal character of the loss on non-deliverable currency options and forward contracts. Therefore this legal character has been determined in the light of Polish corporate income tax act. What is more, the problems with the interpretation of these losses as indirect deductible expenses have been solved.

scholarly journals Loss on Non-Deliverable Currency Options or Forward Contracts in Corporate Income Tax and the Notion of Expense Related to Acquisition of a Derivative

2016 ◽  
Vol 1 (2) ◽  
pp. 1-14
Author(s):  
Łukasz Karczyński
Keyword(s):  
Financial Crisis ◽  
Income Tax ◽  
Corporate Income Tax ◽  
Currency Options ◽  
Forward Contracts ◽  
Taxable Income ◽  
Legal Provisions ◽  
Administrative Courts ◽  
Proper Interpretation

Abstract Due to financial crisis many entrepreneurs suffered heavy losses on currency options and forward contracts. Tax authorities tend to disallow deduction of those losses from the taxable income. Many cases ended up in administrative courts, resulting in judicature controversies on the issue in question. This paper is the second of four in a cycle. The aim of the whole cycle will be to analyze deeply these controversies and suggest the proper interpretation of the legal provisions, determining whether losses on currency options and forward contracts should or should not be regarded as tax-deductible expenses. The aim of this paper is to determine if the aforementioned losses may be regarded as expenses related to acquisition of these derivatives (excluded from tax-deductible expenses). The conducted analysis suggests that the expenses made to pay the losses cannot be regarded as such expenses, so they should be regarded as tax-deductible expenses if there are no other obstacles.

scholarly journals Measuring the Effects of Corporate Tax Cuts

2018 ◽  
Vol 32 (4) ◽  
pp. 97-120 ◽  
Author(s):  
Alan J. Auerbach
Keyword(s):  
Multinational Corporations ◽  
Income Tax ◽  
Capital Investment ◽  
Corporate Income Tax ◽  
Tax Law ◽  
Corporate Tax ◽  
The Law ◽  
Jobs Act ◽  
The Impact ◽  
Tax Cuts

On December 22, 2017, President Donald Trump signed the Tax Cuts and Jobs Act (TCJA), the most sweeping revision of US tax law since the Tax Reform Act of 1986. The law introduced many significant changes. However, perhaps none was as important as the changes in the treatment of traditional “C” corporations—those corporations subject to a separate corporate income tax. Beginning in 2018, the federal corporate tax rate fell from 35 percent to 21 percent, some investment qualified for immediate deduction as an expense, and multinational corporations faced a substantially modified treatment of their activities. This paper seeks to evaluate the impact of the Tax Cuts and Jobs Act to understand its effects on resource allocation and distribution. It compares US corporate tax rates to other countries before the 2017 tax law, and describes ways in which the US corporate sector has evolved that are especially relevant to tax policy. The discussion then turns the main changes of the Tax Cuts and Jobs Act of 2017 for the corporate income tax. A range of estimates suggests that the law is likely to contribute to increased US capital investment and, through that, an increase in US wages. The magnitude of these increases is extremely difficult to predict. Indeed, the public debate about the benefits of the new corporate tax provisions enacted (and the alternatives not adopted) has highlighted the limitations of standard approaches in distributional analysis to assigning corporate tax burdens.

scholarly journals Management Of Accrual Components In Response To Corporate Income Tax Rate Changes: Evidence From Korea

2013 ◽  
Vol 29 (5) ◽  
pp. 1421 ◽  
Author(s):  
Won-Wook Choi ◽  
Hyun-Ah Lee
Keyword(s):  
Financial Reporting ◽  
Income Tax ◽  
Tax Avoidance ◽  
Corporate Income Tax ◽  
Tax Rate ◽  
Taxable Income ◽  
Accruals Management ◽  
Accrual Management ◽  
Aggressive Tax Avoidance ◽  
Statutory Tax Rate

Changes in the statutory corporate income tax rate provide firms with an opportunity to reduce their tax burden by shifting their taxable income from higher to lower tax rate years. One negative consequence of shifting taxable income across years is higher variation in book income for financial reporting purposes. Taxable income and book income are closely related in most countries, and, in general, reporting volatile book income across years is not a favorable signal to investors. This study investigates how firms shift taxable income and concurrently mitigate book income fluctuation by managing accrual components separately when the statutory income tax rate changes. Unlike prior studies, we decompose discretionary accruals into two components and examine distinctive patterns of accrual management in Korea, where book-tax conformity is high and aggressive tax avoidance is restricted. We find that firms manage book-tax accruals for taxable income shifting and manage book-only accruals to mitigate book income fluctuation. Furthermore, we find the extent of book-tax and book-only accruals management varies depending on the firms tax and financial reporting costs. The results of this study provide clear and compelling evidence of firms opportunistic accrual management behavior in response to statutory tax rate reduction.

scholarly journals PENERAPAN PERYATAAN STANDAR AKUNTANSI KEUANGAN NOMOR 46 TENTANG AKUNTANSI PAJAK PENGHASILAN DAN UNDANG-UNDANG NOMOR 36 TAHUN 2008 TENTANG PAJAK PENGHASILAN ATAS PAJAK PENGHASILAN BADAN PADA PT.MEGA JASAKELOLA

2014 ◽  
Vol 8 (3) ◽  
Author(s):  
Ray Marcel Letlora ◽  
Jantje J. Tinangon ◽  
Lintje Kalangi
Keyword(s):  
Analytical Method ◽  
Income Tax ◽  
Descriptive Analysis ◽  
Income Taxes ◽  
Corporate Income Tax ◽  
Business Services ◽  
Taxable Income ◽  
Research Results ◽  
Deferred Tax ◽  
Accounting For Income Taxes

The application of PSAK No. 46, Accounting for Income Taxes expected to bridge between accounting and tax laws with provisions. The purpose of this study is to investigate the application of PSAK No. 46 and Act No. 36 of 2008 on corporate income tax on PT.mega Jasakelola. The analytical method used is descriptive analysis. The application of PSAK No.46 of research results 46 top corporate income tax has been applied on PT.Mega Jasakelola especially regarding deferred tax, taxable income and tax payable now. Implementation of Act No. 36 of 2008 on income tax on business services is appropriate PT Mega Jasakelola Taxation existing regulations. PT.Mega Jasakelola has implemented reporting income tax on their annual tax return, in accordance with the provisions of this is evidenced by the positive correction done at the expense of the non- taxable.

scholarly journals ANALISIS PERHITUNGAN PAJAK PENGHASILAN KARYAWAN PADA PT.KDC SAMARINDA

2019 ◽  
Vol 3 (1) ◽  
pp. 13
Author(s):  
Mardiana , ◽  
Fibby Rismawati
Keyword(s):  
Income Tax ◽  
Analytical Tool ◽  
The State ◽  
Taxable Income ◽  
Permanent Employee ◽  
The People ◽  
The Law

The purpose of this study is to determine the calculation of income tax (PPh) Article 21 for employees of PT.KDC Samarinda is in accordance with Law Number 36 of 2008 and Minister of Finance Regulation Number 101 / PMK.010 / 2016. Tax is a compulsory contribution to the State owed by an individual or entity that is a force based on the Law, by not getting compensation directly and used for the State's needs for the greatest prosperity of the people. Income is any additional economic capability that is received or obtained by taxpayers, both from Indonesia and from outside Indonesia, which can be used for consumption or to increase the wealth of the taxpayer concerned, by name and in any form.Article 21 Income Tax is a tax on income in the form of salary, wages, honorarium, allowances, and other payments in whatever name and form in connection with employment or position, services, and activities carried out by individuals of domestic tax subjects, as referred to in Article 21 Income Tax Law.The analytical tool used in this study is the amount of individual taxpayer tariffs Article 17 of Law Number 36 of 2008. Changes in the amount of Non-Taxable Income (PTKP) according to Minister of Finance Regulation 101 / PMK.010 / 2016 and office fees according to UU- Law Number 36 of 2008 article 21 paragraph 3The results of this study of Income Tax Calculation (PPh) of employees with permanent employee status at PT. KDC Samarinda are in accordance with Law Number 36 of 2008 and Regulation of the Minister of Finance Number 101 / PMK.010 / 2016

scholarly journals Re-formulation zakat system as tax reduction in Indonesia

2019 ◽  
Vol 9 (1) ◽  
pp. 135
Author(s):  
Harry Djatmiko
Keyword(s):  
Content Analysis ◽  
Income Tax ◽  
The Other ◽  
Financial Instruments ◽  
Taxable Income ◽  
Other Hand ◽  
Tax Reduction ◽  
The Law ◽  
The Impact

Zakat is one of the Islamic financial instruments which is obligatory for every Muslim whose earnings reach the prescribed amount (nishab). On the other hand taxes must still be paid as an obligation of every citizen. Under the law, it is stated that zakat can be a deduction from taxable income. The aim of this research is to offer a more advanced concept, namely zakat can be a deduction from income tax. The technique used in this research is content analysis on the literatures discussing about zakat and tax in Islam. The results of this study suggest that zakat as a deduction from income tax has a greater impact than zakat as merely a deduction from taxable income. Zakat as a deduction from income tax will increase the impact of zakat in a larger economy. Zakat merupakan salah satu instrument keuangan Islam yang wajib ditunaikan oleh setiap umat muslim yang pendapatannya telah memenuhi jumlah yang ditentukan (nisab). Sedangkan, di sisi lain pajak harus tetap dibayarkan sebagai suatu kewajiban dari setiap warga Negara. Berdasarkan undang-undang, disebutkan bahwa zakat dapat menjadi pengurang penghasilan kena pajak. Tujuan penelitian ini ialah untuk menawarkan suatu suatu konsep yang lebih maju yaitu zakat dapat sebagai pengurang pajak penghasilan. Teknik analisis yang digunakan ialah analisis isi terhadap literatur-literatur terkait zakat dan pajak dalam Islam. Hasil penelitian menunjukkan bahwa zakat sebagai pengurang pajak penghasilan memiliki dampak lebih besar daripada jika zakat hanya sebagai pengurang penghasilan kena pajak. Zakat sebagai pengurang pajak penghasilan akan meningkatkan dampak zakat di dalam perekonomian yang lebih besar

Tax Administration versus Tax Rates: Evidence from Corporate Taxation in Indonesia

2021 ◽  
Vol 111 (12) ◽  
pp. 3827-3871
Author(s):  
M. Chatib Basri ◽  
Mayara Felix ◽  
Rema Hanna ◽  
Benjamin A. Olken
Keyword(s):  
Developing Countries ◽  
Income Tax ◽  
Corporate Taxation ◽  
Corporate Income Tax ◽  
Tax Revenue ◽  
Tax Administration ◽  
Tax Rates ◽  
Taxable Income ◽  
Elasticity Of Taxable Income ◽  
Percentage Points

We compare two approaches to increasing tax revenue: tax administration and tax rates. We show that when Indonesia moved top regional firms into “medium taxpayer offices,” with high staff-to-taxpayer ratios, tax revenue more than doubled. Examining nonlinear changes to corporate income tax rates, we estimate an elasticity of taxable income of 0.579. Combining these estimates, improved tax administration is equivalent to raising top rates on all firms by 8 percentage points. On net, improved tax administration can have significant returns for developing countries. (JEL H25, H26, K34, O17)

scholarly journals Implied contributions for jointly acquired property based on Islamic family law in Malaysia

2021 ◽  
Vol 5 (S4) ◽  
Author(s):  
Mohd Syahmil Samsudin ◽  
Nur Sarah Tajul Urus ◽  
Shahmi Awang ◽  
Alias Azhar
Keyword(s):  
Single Mothers ◽  
Financial Planning ◽  
Family Law ◽  
Standard Procedure ◽  
Muslim Woman ◽  
Future Research ◽  
The Third ◽  
Legal Provisions ◽  
Islamic Family Law ◽  
The Law

The Islamic Family Law Enactment for the states in Malaysia have recognized that jointly acquired property can be claimed by a Muslim woman due to death, divorce, or polygamy. It is in line with the TN50 target to empower women and elevate the dignity of women and prepare them for 2050. Besides that, the legal stipulation shows the law protects the rights of women to enables them to prepare for their future financial planning even after becoming widows or single mothers. The first objective of this study is to identify the legal provisions related to jointly acquired property. The second objective is to highlights the previous studies and cases related to jointly acquired property claims and the third is to propose a simple, quick and friendly standard procedure for jointly acquired property applications. This paper is also expected to provide an understanding regarding on jointly acquired property for future research.

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