Corporate Tax
Short definition
Corporate tax is the levy on taxable corporate profit. Advance and instalment tax split cash timing from P&L expense; the tax base diverges from IFRS profit through disallowances and exemptions.
Detailed explanation
The statutory rate moves with policy and incentives; there is no universal “right T”. Cash leaves on an instalment calendar and is a separate 13-week line.
Interest deductibility is the source of the shield; thin-cap and transfer pricing cut it. Loss carry-forwards cut future taxable income and bind tax capacity.
Why it matters for the CFO
CFADS and FCF are mistaken for debt capacity before cash tax. Advance tax can still take cash in a loss-making period.
How to read it
Tax expense ≠ tax paid. The bridge is IFRS profit → tax base → assessment → payment calendar.
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What to learn next
Definitions are educational. They are not investment, credit or tax advice.