Effective for financial years beginning on or after 1 January 2019, IFRIC 23 ‘Uncertainty Over Income Tax Treatments’ (‘the Interpretation’) requires entities to consider the potential for adverse tax determinations being made by taxing authorities while under a hypothetical tax review – and record a liability (and expense) where such a finding is considered “probable”.

Many entities may not experience a financial impact as a result of this, but the Interpretation remains applicable and certain disclosures may be appropriate.


Preparers are expected to apply the tax rules in good faith. This Interpretation expands on this principle and requires an entity to record a liability where it is considered probable that an uncertain tax treatment that affects the determination of taxable income, tax bases, unused tax losses, unused tax credits and tax rates, would not be resolved in favour of the entity if it were to be reviewed by a taxation authority.