AASBB Mission: To promote high quality financial reporting and auditing standards that are consistent with international best practices through the development and implementation of Bhutanese Accounting Standards (BAS) and Bhutanese Standards on Auditing (BSA).
Upcoming Events
AASBB SIte Visitors
Flag Counter
Currently viewing the comment posted by user's .   |   Back to Topic  |     Login  
 
Reader Comments on ::   Tax issues
Sorry, but Announcement Menu is empty & there is no data/information uploaded under the same regarding Tax issues.

Is there any other Menu being updated.

Thanks.
Posted By: krsingh.ajay      Posted on: 2018-05-15 11:57:13
Yes, the Department of Revenue & Customs has now clarified on many issues related to Tax and the AASBB Secretariat has posted in the Announcement Module under Notification for BAS and Tax Treatment. Might be helpful who ever reads!!
Posted By: Sonam Wangdi      Posted on: 2018-05-15 11:57:13
The DRC has now issued a formal ruling on the issues that were identified and raised. All Regional Offices have been informed of the rulings. The issues raises are:
1 Valuation of Inventories BAS 2: The Income Tax Act only permits the use of cost. If any inventory is written down to "net realisable value" an adjustment needs to be made for tax purposes
2 Capitalisation of Spares (see clause 8 of BAS 16) spares relating to a single item of PPE can be depreciated for tax purposes. Spares that can be used for a range of equipment cannot be depreciated for tax purposes
3 Construction Contracts BAS 11 Income should always have been calculated on an accrual basis. BAS 11 may clarify the accounting treatment but the income shown in the P&L is correct for tax purposes and no further adjustment is required
4 Consolidated Financial Statements BAS 27 Companies are liable for tax at the individual company level and not at the group level (no change from present)
5 Alteration of Comparatives (see separate forum item on this) If any income or expenses get shifted into 2012 due to changing the comparatives, the company needs to make sure it is included in the 2013 tax return
6 BAS 19 Employee Benefits (early adoption) Deductiblity of gratuity payments is dependent on placing the money into a separate fund. The method of calculating how much isn't relevant. No adjustment will be required for tax purposes
7 BAS 28 Accounting for Associates (early adoption) A company is only liable for tax on dividends received, not the accrual of the share of profits
Posted By: Roy Whittington      Posted on: 2018-05-15 11:57:13
During the meeting between DHI, DRC and AASBB in the month of October 2013, most of the issues raised by DHI were clarified. However, with regard to adoption of BAS by DHI, DRC made it clear during the meeting that in view of financial considerations, the issue merits further discussion with the Ministry of Finance. DHI has already written to MoF on the same issues and the Public Ent. Division of MoF is looking into it. Meanwhile, we solicit the comments from AASBB if any on the issues raised by Mr. Roy.
Posted By: Loday Phintsho      Posted on: 2018-05-15 11:57:13
A meeting was held in October at RCO to discuss tax issues. Representatives from AASBB and DHI attended. Subsequently, the AASBB circulated companies asking for any tax issues related to the introduction of BAS. DHI made a submission repeating the issues discussed at the October meeting. The submissions were discussed at a AASBB Technical Committee meeting. The AASBB undertook to follow up the issues on behalf of all companies in Bhutan
We are still waiting for an answer to the issues raised. Companies will be completing their annual accounts in the next month but the tax provided in those accounts depends on the RCO providing clarification. DHI is considering early adoption of a standard from the second phase but this depends on the RCO's response.
The AASBB must follow up immediately
Posted By: Roy Whittington      Posted on: 2018-05-15 11:57:13
If the tax issues you were referring to is the one raised by DHI, DRC has clarified during the meeting with DHI. There after, we did not remember receiving any tax issues from the AASBB or the companies.
Posted By: Loday Phintsho      Posted on: 2018-05-15 11:57:13
The AASBB recently circulated companies asking for any issues they foresaw arising from the introduction of BAS. I think I prepared the only response.
What progress has been made on clarifying issues with the RCO? Companies will be finalising accounts soon and we need the RCO's rulings so that the tax calculation is correct
Posted By: Roy Whittington      Posted on: 2018-05-15 11:57:13

  You must be logged in to create new topics and to make comment on others comments.   Login  

  Your comments will be read, verified and approved by Administrator