BC1 When IAS 12 Income Taxes was issued by the International Accounting Standards Committee in 1996 to replace the previous IAS 12 Accounting for Taxes on Income (issued in July 1979), the Standard was not accompanied by a Basis for Conclusions. This Basis for Conclusions is not comprehensive. It summarises only the considerations of the International Accounting Standards Board (Board) in developing amendments to IAS 12 since 2010. Individual Board members gave greater weight to some factors than to others.

BC1A In August 2014 the Board published an Exposure Draft of proposed amendments to IAS 12 to clarify the requirements on recognition of deferred tax assets for unrealised losses on debt instruments measured at fair value. The Board subsequently modified and confirmed the proposals and in January 2016 issued Recognition of Deferred Tax Assets for Unrealised Losses (Amendments to IAS 12). The Board’s considerations and reasons for its conclusions are discussed in paragraphs BC37-BC62.

BC2 The Board amended IAS 12 to address an issue that arises when entities apply the measurement principle in IAS 12 to temporary differences relating to investment properties that are measured using the fair value model in IAS 40 Investment Property.