EXCEL FORCE MSC BERHAD Annual Report 2020

EXCEL FORCE MSC BERHAD - ANNUAL REPORT 2020 99 NOTES TO THE FINANCIAL STATEMENTS 31 DECEMBER 2020 (CONT’D) 27. TAXATION (CONT’D) The salient terms of the Pioneer Status are as follows: (i) 100% tax exemption on business income; (ii) unabsorbed pioneer capital allowances can be carried forward to the post pioneer period and deducted against the post-pioneer income of a business relating to the same promoted activity or promoted product; and (iii) unabsorbed pioneer losses can be carried forward to the post pioneer period and deducted against the post-pioneer income of a business relating to the same promoted activity or promoted product. Malaysian income tax is calculated at the statutory tax rate of 24% (2019: 24%) of the estimated assessable profits for the financial year. A reconciliation of income tax expenses applicable to profit before tax at the statutory income tax rate to income tax expenses at the effective income tax rate of the Group and of the Company are as follows: Group Company 2020 2019 2020 2019 RM RM RM RM Profit before tax 14,174,969 8,290,110 13,814,830 8,015,418 At Malaysian statutory tax rate of 24% (2019: 24%) 3,401,993 1,989,626 3,315,559 1,923,700 Expenses not deductible for tax purposes 712,943 648,577 660,068 559,624 Income not subject to tax (925,129) (926,761) (922,342) (926,761) Deferred tax assets not recognised 290,512 52,804 290,512 52,804 Utilisation of previously unrecognised deferred tax assets (132,476) (154,879) - - Under provision of income tax in prior years 61,019 209,293 56,540 209,292 Tax expenses for the financial year 3,408,862 1,818,660 3,400,337 1,818,659 The Group have unused tax losses of RM922,675 (2019: RM1,303,443) available for carry forward to offset against future taxable profits. The said amounts are subject to approval by the tax authorities. 28. DEFERRED TAXATION The net deferred tax liabilities and assets shown on the statements of financial position after appropriate offsetting are as follows: Group Company 2020 2019 2020 2019 RM RM RM RM Deferred tax liabilities 111,938 49,899 70,235 49,288 Deferred tax assets (111,938) (49,899) (70,235) (49,288) - - - -