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Explanation: Tax, as recorded in the income statement, represents the amount of taxes paid by a company during a specific financial period. It includes various types of taxes, such as income tax, corporate tax, and other taxes levied on the company’s earnings.
Example: In FY 2023, TCS (Tata Consultancy Services) paid 14,604 crore rupees in taxes. This figure reflects the total amount of taxes TCS was required to pay to the relevant tax authorities based on its taxable income and applicable tax rates for that fiscal year.
Taxes paid by companies are an essential component of the income statement as they directly impact the company’s net income and profitability. They represent one of the primary expenses incurred by the company in generating its revenue and are deducted from the company’s pre-tax earnings to arrive at its net income.
You can view the quarterly and annual Tax for any company on Radar in the Quarterly Results and Yearly P/L sections.