While employment is an activity exclusively engaged in by individuals, business and investment activities may be engaged in by individuals or legal persons. Consequently, the rules for taxing income from business and investment cut across the taxation of individuals and legal persons. Countries with separate tax laws for individuals and legal persons need to coordinate the rules for taxing business and investment income, even though these may not always be uniform. Regardless of the overall design of the income tax, it is common to provide special rules for taxing business or investment income. These rules primarily relate to the tax base, timing of the recognition of income and deductions, and collection of tax. By far the most important are the timing rules. Particularly in the business context, these rules must negotiate the difficult terrain that bridges financial accounting and taxation. While uniformity between tax and financial accounting may seem desirable, countries have adopted quite different approaches: some countries have achieved substantial uniformity; in others, tax and financial accounting are substantially independent.

Tax, taxable business income, balance-sheet method

Marjaana Helminen, EU TAX LAW direct taxation, IBFD print books, August, 2021 edition;

Tax Law Design and Drafting (volume 2; International Monetary Fund) Chapter 16, Taxation of Income from Business and Investment;

Nazarov Nodirjon, Financial Risks in Islamic Financing, Eurasian Journal of History, Geography and Economics Vol. 19, 40-48;

Nazarov N. N., Islamic banking: problems, solutions and prospectives, World Economics and Finance Bulletin 21, 153-159;

Nazarov N., the engagement between Islamic and conventional banking, 2023.