Kimlun Corporation Berhad Annual Report 2018

10. Income tax expense (cont'd) Reconciliation between tax expense and accounting profit The reconciliation between tax expense and the product of accounting profit multiplied by the applicable corporate tax rate for the years ended 31 December 2018 and 2017 are as follows: Group Company 2018 2017 2018 2017 RM RM RM RM Profit before tax 81,666,262 90,034,951 18,310,725 20,330,018 Taxation at Malaysian statutory tax rate of 24% (2017: 24%) 19,599,903 21,608,388 4,395,000 4,879,000 Different tax rates in other countries 1,571 2,070 - - Effect of reduction in Malaysian income tax rate - (729,982) - - Expenses not deductible for tax purposes 6,548,481 4,752,020 168,000 248,000 Income not subject to tax (4,727,226) (4,169,083) (4,104,000) (4,616,000) Utilisation of unrecognised deferred tax assets (254,113) - - - Deferred tax assets not recognised on unabsorbed capital allowances and unutilised tax losses 536,280 777,675 - - Utilisation of current year's reinvestment allowances and business losses (309,800) - - - Utilisation of previous year's unabsorbed capital allowances (285,856) - - - Share of tax of joint ventures (12,007) (781) - - (Over)/underprovision of income tax in prior years (746,128) (77,203) 426 265 Under/(over)provision of deferred tax in prior years 250,049 (466,010) - - Income tax expense recognised in profit or loss 20,601,154 21,697,094 459,426 511,265 Domestic income tax is calculated at the Malaysian statutory tax rate of 24% (2017: 24%) of the estimated assessable profit for the year. On 21 October 2016, the Government of Malaysia announced the reduction of income tax rate based on the percentage of increase in chargeable income as compared to the immediate preceding year of assessment, applicable to years of assessment 2017 and 2018. The effect of the change in tax rate is reflected in the computation of income tax. Kimlun Corporation Berhad 93 NOTES TO THE FINANCIAL STATEMENTS For the financial year ended 31 December 2018 (cont’d