MKH Annual Report 2018

126 MKH Berhad Annual Report 2018 8. TAX EXPENSE (Cont’d) A reconciliation of tax expense applicable to profit before tax at the applicable statutory income tax rate to tax expense at the e ective income tax rate of the Group and of the Company is as follows: The Group The Company 2018 2017 2018 2017 RM RM RM RM Profit before tax 126,698,478 193,592,301 62,151,457 50,665,944 Tax calculated using Malaysian tax rate of 24% (2017:24%) 30,407,600 46,462,200 14,916,400 12,159,800 Tax e ects of: Non-deductible expenses 11,355,307 11,837,430 1,321,100 1,742,000 Non-taxable income (2,921,322) (2,862,615) (12,124,000) (10,648,800) Share of results of associates (86,539) 529,475 - - E ect of changes in tax rate: Investment properties 60,230 (567,696) - - Real property gains tax 6,496,070 - - - E ect of changes in overseas tax rate: The People’s Republic of China 9,000 10,389 - - Republic of Indonesia 182,646 156,638 - - Deferred tax assets not recognised 6,477,740 9,180,863 - - Realisation of deferred tax assets not recognised in prior financial years (1,704,700) (1,851,706) - - Utilisation of reinvestment allowance (66,300) (516,000) - - Under/(Over)provision in prior financial year: Current tax 1,673,630 7,624,262 24,584 6,546 Deferred tax (264,722) (1,254,197) - - Tax expense 51,618,640 68,749,043 4,138,084 3,259,546 As mentioned in Note 3, the tax e ects of deductible temporary di erences, unused tax losses and unused tax credits which would give rise to net deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the deductible temporary di erences, unused tax losses and unused tax credits can be utilised. As of 30 September 2018, the estimated amount of deductible temporary di erences, unused tax losses and unused tax credits, for which the net deferred tax assets are not recognised in the financial statements due to uncertainty of realisation, is as follows: The Group 2018 2017 RM RM Unused tax losses 33,763,385 31,588,664 Unabsorbed capital allowances 94,686 103,213 Other temporary di erences 94,912,753 77,191,281 128,770,824 108,883,158 FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2018 NOTES TO THE FINANCIAL STATEMENTS