A non-current asset (a machine) was purchased by Lotus plc on 1 July 2020 at a cost of $50,000. The company prepares its annual accounts for 31 March each year. The policy of the company is to depreciate such assets at the rate of 15% straight line (with depreciation being charged pro-rata on a time-apportionment basis in the year of purchase). The company was granted capital allowances at 25% per annum on the reducing balance method (such capital allowances are apportioned pro-rata on a time-apportionment basis in the year of purchase).

The rate of corporation tax has been as follows:

Year ended

31 Mar 2021 25%

31 Mar 2022 35%

31 Mar 2023 25%

31 Mar 2024 24%

31 Mar 2025 24%

Based on the given information,

a) CALCULATE the deferred tax provision using both the deferred method and the liability method. (25 marks)