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Notes to the Consolidated Financial Statements

31st March 2015

10 INCOME TAX (EXPENSE)/CREDIT

Hong Kong profits tax has been provided at the rate of 16.5% (2014: 16.5%) on the estimated
assessable profits for the year. Taxation on overseas profits has been calculated on the estimated
assessable profits for the year at the rates of taxation prevailing in the countries in which the Group
operates.

Group
2015 2014
HK$’000 HK$’000

Continuing operation

Current income tax
– Hong Kong profits tax (8,713) (3,992)
– PRC corporate income tax (3,900) –
– Over/(under) provision in prior years 92 (9)

Deferred income tax credit 2,119 4,984

Income tax (expense)/credit (10,402) 983

The tax on the Group’s profit before income tax differs from the theoretical amount that would arise
using the tax rate of Hong Kong as follows:

Group
2015 2014
HK$’000 HK$’000
Continuing operation

Profit before income tax 124,577 5,714
Tax calculated at a tax rate of 16.5% (2014: 16.5%) (20,555) (942)
Effect of different tax rates in other countries (3,458) 2,808
Income not subject to tax 16,712 15,462
Expenses not deductible for tax purposes (3,181) (17,544)
Over/(under) provision in prior years 92 (9)
Tax losses for which no deferred income tax asset
was recognised (12) (18)
Recognition of previously unrecognised deferred tax – 1,207
Utilisation of previously unrecognised tax losses – 19

Income tax (expense)/credit (10,402) 983

ALCO HOLDINGS LIMITED ANNUAL REPORT 2015 67