Compare accounting depreciation and tax depreciation.

Banking & FinanceManagementCompanies/Organisations

The major differences between accounting depreciation and tax depreciation are as follows −

Accounting depreciation

  • It is prepared for accounting purpose.

  • It is based on International Accounting Standards Board (IASB) and accounting principles.

  • One can choose any depreciation method.

  • It is more accurate as compared to tax depreciation.

Tax depreciation

  • It is prepared for income tax purpose.

  • It is based on Internal Revenue service (IRS) regulations.

  • It uses accelerated depreciation method.

  • It is less accurate as compared to accounting depreciation.

raja
Published on 25-Jul-2020 10:27:13
Advertisements