Kimlun Corporation Berhad Annual Report 2020

200901023978 (867077-X) Kimlun Corporation Berhad (Incorporated in Malaysia) 2. Summary of significant accounting policies (cont'd) 2.22 Taxes (cont'd) (b) Deferred tax (cont'd) (c) Goods and Services Tax ("GST") Revenue, expenses and assets are recognised net of the amount of GST, except: - - Receivables and payables that are stated with the amount of GST included. (d) Sales and Services Tax ("SST") Revenue, expenses and assets are recognised net of the amount of SST, except: - - When receivables and payables are stated with the amount of SST included. Where the amount of GST incurred in a purchase of assets or services is not recoverable from the taxation authority, the GST is recognised as part of the cost of acquisition of the assets or as part of the expense item, as applicable; and Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority. Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax items are recognised in correlation to the underlying transaction either in other comprehensive income or directly in equity and deferred tax arising from a business combination is adjusted against goodwill on acquisition. When the SST incurred on a purchase of assets or services is not recoverable from the taxation authority, the SST is recognised as part of the cost of acquisition of the assets or as part of the expense item, as applicable; and Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the reporting date. The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables and payables respectively in the statements of financial position. - 50 - 107 Kimlun Corporation Berhad Registration No. 200901023978 (867077-X) NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2020