Income Tax Payable


DEFINITION of 'Income Tax Payable'

A type of account in the current liabilities section of a company's balance sheet . This account is comprised of taxes that must be paid to the government within one year. Income tax payable is calculated according to the prevailing tax law in the company's home country.


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BREAKING DOWN 'Income Tax Payable'

This account is usually identified in the balance sheet when the company has received its tax bill but has put off paying it for the time being. The taxes are calculated on the company's net income according to its corporate tax rate. If a company is due to receive a tax benefit from its respective revenue agency, the amount of income tax payable will decrease.

  1. Balance Sheet

    A financial statement that summarizes a company's assets, liabilities ...
  2. Tax Expense

    A liability owing to federal, state/provincial and municipal ...
  3. Income Tax

    A tax that governments impose on financial income generated by ...
  4. Current Liabilities

    A company's debts or obligations that are due within one year. ...
  5. Internal Revenue Service - IRS

    A United States government agency that is responsible for the ...
  6. Corporate Tax

    A levy placed on the profit of a firm, with different rates used ...
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