Assessable Profit


DEFINITION of 'Assessable Profit'

Taxable income payable after accounting for allowable deductions. Assessable profit is a calculation used in tax law to determine an individual's taxable income based upon gains or losses on funds held in taxable investment accounts. It is taken net of items, such as expenses within an investment account, depreciation and charitable donations.

BREAKING DOWN 'Assessable Profit'

Assessable profits are an important tax measure in constituencies where tax payers may see large portions of taxable income come from investments held in taxable investment accounts. In Hong Kong, for instance, assessable profits are used to determine an individual's HK profits taxes payable. Such tax income is important for jurisdictions that rely on taxation for a bulk of their budgetary capital.

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  1. Do dividends affect working capital?

    Regardless of whether cash dividends are paid or accrued, a company's working capital is reduced. When cash dividends are ... Read Full Answer >>
  2. Do prepayments provide working capital?

    Prepayments, or prepaid expenses, are typically included in the current assets on a company's balance sheet, as they represent ... Read Full Answer >>
  3. Does working capital include salaries?

    A company accrues unpaid salaries on its balance sheet as part of accounts payable, which is a current liability account, ... Read Full Answer >>
  4. What is a profit and loss (P&L) statement and why do companies publish them?

    A profit and loss (P&L) statement, or balance sheet, is essentially a snapshot of a company's financial activity for ... Read Full Answer >>
  5. How do dividends affect the balance sheet?

    Dividends paid in cash affect a company's balance sheet by decreasing the company's cash account on the asset side and decreasing ... Read Full Answer >>
  6. Are dividends considered an expense?

    Cash or stock dividends distributed to shareholders are not considered an expense on a company's income statement. Stock ... Read Full Answer >>

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