What Is Deferred Income Tax?

Patrick Curtis

Reviewed by

Patrick Curtis WSO Editorial Board

Expertise: Investment Banking | Private Equity

Deferred Income Tax is an accounting concept which refers to any income which has been earned and accounted for, but has not yet had any tax paid on it.

Therefore, this is a liability on the Balance Sheet as it is effectively a debt to the government. The usual reason for tax being deferred is because of different tax liabilities in terms of tax laws and accounting methods.

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Patrick Curtis

Patrick Curtis is a member of WSO Editorial Board which helps ensure the accuracy of content across top articles on Wall Street Oasis. He has experience in investment banking at Rothschild and private equity at Tailwind Capital along with an MBA from the Wharton School of Business. He is also the founder and current CEO of Wall Street Oasis. This content was originally created by member WallStreetOasis.com and has evolved with the help of our mentors.