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The Difference Between Accounting And Tax Accounting?

Accounting, including tax accounting, is a requirement for the work of any enterprise, and most importantly, the accuracy of the preparation and the availability of all documents. Capital Tax Consulting provides professional tax and accounting services.

  • The main differences between accounting and tax accounting in terms of corporate income taxes are as follows:
  • Accounting is a reflection of all activities of the organization, whether its operations are approved by official documents or not.

Tax accounting contains only the documents used to create tax deductions.

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Of course, these accounts have their income and expense accounts and are completely different.

What is accounting and tax accounting, the purpose of the application

Accounting – a strictly legally designed document that presents information about all facilities and activities of the organization operating through this facility.

The main purpose of using the account is to collect several documents that clearly show the results of the organization’s activities and the impact of the use of these methods on the implementation of organizational objects.

For example, a bank’s decision to provide a loan to a company often depends on its financial data, in addition, this information is required when participating in auctions or competitions. Therefore, a capital tax advisory firm needs to delegate the collection to experts in their field.

The purpose and application of tax accounting

Tax accounting is the collection and analysis of data to create a tax base based on documented information by official policies in force in the Russian Federation.

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The primary purpose of tax accounting is to replace the interest rate on a company’s earnings. This depends on the general tax system the organization uses.

The main difference

The main features of this type of accounting are:

1. Determine the company’s income

Accounting is not aggregate on an accrual basis only. But it also includes tax and cash accrual options. Both accounting options include items of income that are not subject to accounting. Therefore, keeping two accounts leads to earnings records of different companies.

2. Record the company’s expenses

The company’s expense records in both accounts are nearly identical and there is no significant difference. The main difference is that they are divide into indirect expenses and main expenses only incurred in tax accounting.

3. Differences in depreciation of fixed assets

Premium in tax accounting – takes the form of depreciation, which is not in accounting.

  •  Create a backup plan
  • Differences when collecting accounts

The report must be submitted to the IRS within the stipulate time. By the time the account is processed and accounts prepared as necessary. Such as analyzing the company’s activities

Accounting and tax accounting majors in the preparation and processing of documents. Therefore, it is important not only to choose the correct data for the assembly but also to choose the right data for the assembly. But you also need to analyze the data

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