BIRLESIM_2021_ANNUAL REPORT

BİRLEŞİM MÜHENDİSLİK 2021 ANNUAL REPORT 196 Birleşim Mühendislik Isıtma Soğutma Havalandırma Sanayi Ticaret A.Ş. and Its Subsidiary (All amounts expressed in Turkish Lira (“TL”)) Notes to the Consolidated Financial Statements For the Year Ended 31 December 2021 28. INCOME TAXES (INCLUDING DEFERRED TAX ASSETS AND LIABILITIES) As of te 1 January - 31 December 2021 and 2020, Income Tax details are as follows: Tax for the Period Assets 31 December 2021 31 December 2020 Prepaid Taxes and Funds 18.265.327 4.326.317 Total 18.265.327 4.326.317 Tax for the Period Liabilities 31 December 2021 31 December 2020 Tax for the Period Provision 12.446.296 25.738.530 Minus: Prepaid Taxes and Funds (12.446.296) (25.738.530) Total - - Tax Expenses 1 Jauary - 31 December 2021 1 January - 31 December 2020 Tax Charges for the Period (12.446.296) (25.738.530) Deferred tax Income/(Charge) (11.669.443) 9.076.684 Total (24.115.739) (16.661.846) Corporate Tax The Group is subject to corporate tax valid in Turkey. In Turkey, the corporation tax rate is 25% (2020: 22%), With the change in the Corporate Tax Law which was published in the Official Gazette dated 22 April 2021, and numbered 31462, the corporate tax rate applied in Turkey is 25% for 2021, 23% for 2022, and 20% for 2023 and the following years. Corporation tax rate is applicable on the total income of the companies after adjusting for certain disallowable expenses, income tax exemptions (participation exemption, investment incentive exemption, etc,) and income tax deductions (for example research and development expenses deduction), No further tax is payable unless the profit is distributed. The tax legislation provides for a temporary tax of 25% to be calculated and paid based on earnings generated for each quarter, Temporary tax returns are required to be filed by the fourteenth day of the second month following the each quarter and must be paid in one installment by the seventeenth of the second month, The amounts thus calculated and paid are offset against the final corporate tax liability for the year. There is no such application for the reconciliation of payable taxes with the tax authority, Corporate tax returns are submitted to the related tax office by the 25 th day of the 4 th month following the month when the accounting period ends. In tax reviews authorized bodies can review the accounting records for the past five years and if errors are detected, tax amounts may change due to tax assessment. Corporate tax losses can be carried forward for a maximum period of five years following the year in which the losses were incurred, However, losses realized may not be deducted from profits obtained in previous years.