Income Tax Payable

AAA

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.

INVESTOPEDIA EXPLAINS '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.

VIDEO

RELATED TERMS
  1. Tax Expense

    A liability owing to federal, state/provincial and municipal ...
  2. Balance Sheet

    A financial statement that summarizes a company's assets, liabilities ...
  3. Corporate Tax

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

    A company's debts or obligations that are due within one year. ...
  5. Income Tax

    A tax that governments impose on financial income generated by ...
  6. Internal Revenue Service - IRS

    A United States government agency that is responsible for the ...
Related Articles
  1. Retirement

    Tax Tips For The Individual Investor

  2. How To File Your Child's First Income Tax Return
    Taxes

    How To File Your Child's First Income ...

  3. Taxes

    Winning The Jackpot: Dream Or Financial ...

  4. Taxes

    Surviving The IRS Audit

Hot Definitions
  1. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  2. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  3. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  4. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  5. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  6. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
Trading Center