sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
Latest Circulars »
 RBI-Customer Service provided by agency banks
 RBI-Control measures for ATMs – Timeline for compliance
 RBI releases Draft Directions on requirement of Legal Entity Identifier Code for participation in non-derivative markets
 Liberalised Remittance Scheme – Harmonisation of Data and Definitions
  RBI - Auction of Government o India Dated Securities
  Investment by Foreign Portfolio Investors (FPI) in Debt - Review
 CPE Events 18th May - 23th June 2018
 Basel III Framework on Liquidity Standards - Liquidity Coverage Ratio (LCR), Liquidity Risk Monitoring Tools and LCR Disclosure Standards
  Prudential Norms for Classification, Valuation and Operation of Investment Portfolio by Banks – Spreading of MTM losses and creation of Investment Fluctuation Reserve (IFR)
 Change in name of “The Mahanagar Co-operative Bank Limited, Mumbai” to “GS Mahanagar Co-operative Bank Limited, Mumbai” in the Second Schedule to the Reserve Bank of India Act, 1934
 Section 23 of the Banking Regulation Act, 1949 – Branch Authorisation Policy – Left Wing Extremism affected districts – Revised List

RBI-Deferred Tax Liability on Special Reserve created under Section 36(1) (viii) of the Income Tax Act, 1961-UCBs
June, 02nd 2014

RBI/2013-14/619
UBD. CO. BPD. PCB. Cir. No. 67/09.50.001/2013-14

May 30, 2014

The Chief Executive Officers of
All Primary (Urban) Co-operative Banks

Madam/ Dear Sir,

Deferred Tax Liability on Special Reserve created under
Section 36(1) (viii) of the Income Tax Act, 1961-UCBs

It has been observed that some banks are not creating deferred tax liability (DTL) on Special Reserve as per Accounting Standard 22: 'Accounting for taxes on Income' (AS 22) on the ground that they do not intend to withdraw from such Reserve in the future. In many cases banks have formalised such intent by having resolutions passed by their Boards or Committees to this effect.

2. The matter regarding creation of DTL on Special Reserve has been examined and banks are advised that, as a matter of prudence, DTL should be created on Special Reserve.

3. For this purpose, banks may take the following course of action:

a) If the expenditure due to the creation of DTL on Special Reserve as at March 31, 2013 has not been fully charged to the Profit and Loss account, banks may adjust the same directly from Reserves. The amount so adjusted may be appropriately disclosed in the Notes to Accounts of the financial statements for the financial year 2013-14.

b) DTL for amounts transferred to Special Reserve from the year ended March 31, 2014 onwards should be charged to the Profit and Loss Account of that year.

4. In view of the requirement to create DTL on Special Reserve, banks may reckon the entire Special Reserve for the purpose of computing Tier-I Capital

Yours faithfully,

(P. K. Arora)
General Manager

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Internet Marketing Website Marketing Internet Promotion Internet Marketing India Website Marketing India Internet Promotion India Internet Marketing Consultancy Website Marketing Consulta

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions