The topic of this final paper is the Effects of temporary and permanent differences in determining the corporate income tax base. Income tax is a type of taxation regulated by the Income Tax Act. Income tax must be calculated for the business year, which is also a calendar year, according to the profit of the entrepreneur in that period. As for the profit tax, it can be considered that it is an excellent source of income for the state, ie that the tax is necessary for the economic development of the state. The paper approaches the definition of the effects of permanent and temporary differences in determining the tax base. Thus, we distinguish between temporary and permanent differences, so in the case of temporary differences, they are taxable and deductible. It is characteristic of taxable temporary differences that they result in amounts that are taxable in determining taxable profit in subsequent periods when the carrying amount of the asset will be recovered or a particular liability settled. Significant temporary differences result in amounts that are typically deductible in determining the taxable profit (tax loss) of the next period in which the carrying amount of the asset will be recovered or the liability settled. Permanent differences are those differences between the accounting and tax bases of items of assets and liabilities that are never restated in any of the following tax periods, permanently unrecognized expenses and permanently non-taxable income. The tax effects of temporary differences are recognized in the financial statements, in the balance sheet items of deferred tax assets and in the liability items as deferred tax liabilities, and in the income statement as an item of total tax expense in determining the net result of the period.