KUWAIT ENERGY plc GROUP
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2011
F-145
41.
TAXATION
INCOME TAX EXPENSE
2011
2010
Tax on profit on ordinary activities
USD 000’s
USD 000’s
Current tax:
Corporation tax
8,957
(476)
Total current tax
8,957
(476)
Deferred tax:
Origination and reversal of timing differences
912
(1,225)
Total deferred tax
912
(1,225)
Tax on profit on ordinary activities
9,869
(1,701)
Corporation tax in the Company’s country of domicile is calculated at 0% (2010: 0%) on assessable profits,
this rate being the applicable statutory tax rate for international businesses that are tax resident in Jersey.
Taxation for other jurisdictions are calculated at the rates prevailing in the respective jurisdictions.
Factors affecting the tax charge for the period
The difference between the amount of total tax shown above and the amount calculated by applying the
standard rate of Jersey corporation tax to the profit before tax is as follows:
2011
2010
USD 000’s
USD 000’s
Profit on ordinary activities before tax
44,632
20,201
Tax on Company profit on ordinary activities at corporation tax rate of
0%
-
-
Effects of:
Effect of different tax rates of subsidiaries operating in other
jurisdictions
15,614
(476)
Income not taxable or expenses not deductible
(6,481)
(1,225)
Deferred tax on group restructuring
736
-
Total tax charge / (credit) for the year
9,869
(1,701)
Deferred taxation
2011
2010
Deferred taxation is comprised as follows:
USD 000’s
USD 000’s
Deferred tax asset arising on the recognition of tax losses
8,970
9,146
Deferred tax liability on fixed asset temporary differences
(31,379)
(30,644)
(22,409)
(21,498)
The deferred tax asset shown above primarily arises in Russia, where losses have been incurred in both 2010 and
2011. Management believes it is appropriate to recognize a deferred tax asset, as based on an independent
assessment of its commercial reserves, it expects to generate significant taxable profits in future years in Russia.
There are no material unrecognized deferred tax assets at either year end, nor any material unprovided deferred
tax arising on the unremitted earnings of subsidiaries.
