Cash interest paid and cash taxes paid

Cash interest paid and cash taxes paid are the amounts a company handed over for interest and income taxes during a period. They are usually shown as supplemental lines at the bottom of the cash flow statement or in the notes.

They often differ from the interest and tax expense on the income statement. Expenses are recorded when they are owed, while these lines show when the cash went out. Tax timing differences, interest that accrues before it is paid, and deferred tax all create a difference.

Comparing the two helps check earnings quality. A company whose cash taxes run well below its reported tax expense year after year may be benefiting from timing that will reverse, while cash taxes well above the expense can mean reported profit understates the burden.