10. INCOME TAX EXPENSE Major components of income tax expense Major components of income tax expense for the years ended 31 December 2022 and 2021 are: Group Company 2022 RM’000 2021 RM’000 2022 RM’000 2021 RM’000 Current income tax: – Malaysian income tax 18,097 13,407 25 – – Foreign tax 22,310 18,605 – – – Capital gain tax# 3,612 – – – 44,019 32,012 25 – Under/(over) provision of income tax in prior years: – Malaysian income tax* 7,345 (1,340) 6,930 – – Foreign tax 1,257 (121) – – 8,602 (1,461) 6,930 – 52,621 30,551 6,955 – Deferred tax (Note 24): – Relating to origination and reversal of temporary differences (6,370) 152 – – – Underprovision in prior years 1,098 3,799 – – (5,272) 3,951 – – Income tax recognised in profit or loss 47,349 34,502 6,955 – # Relates to capital gain tax paid to tax authority upon disposal of an associate in India as disclosed in Note 19. * Included in the underprovision of Malaysian income tax is an amount of RM5.3 million recorded resulted from out-of-court settlement with Director General of Inland Revenue Board (“DGIR”) as disclosed in Note 44(c). Domestic income tax is calculated at the Malaysian statutory tax rate of 24% (2021: 24%) of the estimated assessable profit for the year. Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions. Profits derived from overseas branch operations are not subject to Malaysian tax. 10. INCOME TAX EXPENSE (CONTD.) Reconciliation between tax expense and accounting profits A reconciliation of income tax expense and the product of accounting profit multiplied by the applicable corporate tax rate for the years ended 31 December 2022 and 2021 are as follows: Group 2022 RM’000 2021 RM’000 Profit before tax and zakat 93,773 78,569 Less: Zakat (773) (707) 93,000 77,862 Taxation at Malaysian statutory tax rate of 24% (2021: 24%) 22,320 18,687 Tax effect on share of profit of associates (3,249) (5,798) Tax effect on share of profit of a joint venture (1) – Income not subject to tax (526) (2,318) Foreign income not subject to tax (4,347) (8,284) Non-deductible expenses 23,297 18,971 Different tax rates in other countries (1,816) (2,476) Utilisation of previously unrecognised tax losses and unabsorbed capital allowances (6,643) (2,600) Deferred tax assets not recognised during the year 5,002 15,982 Capital gain tax 3,612 – Underprovision of deferred tax in prior years 1,098 3,799 Under/(over) provision of income tax expense in prior years 8,602 (1,461) Income tax expense recognised in statement of comprehensive income 47,349 34,502 The above reconciliation is prepared by aggregating separate reconciliations for each national jurisdiction. Company 2022 RM’000 2021 RM’000 Profit before tax and zakat 45,164 41,412 Taxation at Malaysian statutory tax rate of 24% (2021: 24%) 10,839 9,939 Non-deductible expenses 12,800 10,720 Foreign income not subject to tax (770) (745) Income not subject to tax (18,384) (26,516) Utilisation of previously unrecognised tax losses and other deductible temporary differences (4,460) – Deferred tax assets not recognised – 6,602 Underprovision of income tax expense in prior years 6,930 – Income tax expense recognised in statement of comprehensive income 6,955 – p.308 p.309 UEM EDGENTA BERHAD INTEGRATED ANNUAL REPORT 2022 1 2 3 4 5 6 7 8 9 FINANCIAL STATEMENTS Notes to the financial statements For the year ended 31 December 2022 Notes to the financial statements For the year ended 31 December 2022
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