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DEFERRED TAX LIABILITIES ASSETS | 12 Months Ended
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Mar. 31, 2021
DEFERRED TAX LIABILITIES ASSETS |
DEFERRED TAX LIABILITIES ASSET | NOTE 8 - DEFERRED TAX (LIABILITIES)/ASSETS The Company is subject to taxation in the Russian Federation, Kazakhstan, Kyrgyzstan, Cyprus, Ukraine, Uzbekistan, Germany and the United States of America. The tax rates used for deferred tax assets and liabilities for the years ended March 31, 2021 and 2020, were 21% for the U.S., 20% for the Russian Federation, Kazakhstan, Kyrgyzstan, 31% for Germany, 12.5% for Cyprus, 18% for Ukraine and 15% for Uzbekistan. Deferred tax assets and liabilities of the Company are comprised of the following:
|  | March 31, 2021 |  |  | March 31, 2020 |
Deferred tax assets: |  |  |  |  |  |
Tax losses carryforward |  | $ | 316 |  |  | $ | 1,691 |
Accrued liabilities |  |  | 236 |  |  |  | 7 |
Depreciation |  |  | 16 |  |  |  | - |
Revaluation on trading securities |  |  | - |  |  |  | 72 |
Stock compensation expenses |  |  | - |  |  |  | 4 |
Valuation allowance |  |  | (316 | ) |  |  | (677 | )
Deferred tax assets |  | $ | 252 |  |  | $ | 1,097 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Revaluation on trading securities |  | $ | 2,546 |  |  | $ | 513 |
Fixed and Intangible Assets |  |  | 1,568 |  |  |  | - |
Subordinated debt |  |  | 523 |  |  |  | - |
Other liabilities |  |  | - |  |  |  | 14 |
Deferred tax liabilities |  | $ | 4,637 |  |  | $ | 527 |
Net deferred tax (liabilities)/assets |  | $ | (4,385 | ) |  | $ | 570 |
The Company is subject to the U.S. federal income taxes at a rate of 21%. The reconciliation of the provision for income taxes at the 21% tax rate compared to the Company’s income tax expense as reported is as follows:
|  | Year ended March 31, 2021 |  |  | Year ended March 31, 2020 |
Profit before tax at 21% |  | $ | 36,335 |  |  | $ | 5,908 |
Global intangible low taxed income |  |  | 18,451 |  |  |  | 4,803 |
Stock based compensation |  |  | 348 |  |  |  | 551 |
Provision for impairment losses |  |  | 187 |  |  |  | (295 | )
Permanent differences |  |  | 24 |  |  |  | 793 |
Valuation allowance |  |  | (361 | ) |  |  | 416 |
Nontaxable gains |  |  | (4,244 | ) |  |  | 401 |
Foreign tax credit |  |  | (10,155 | ) |  |  | (3,503 | )
Foreign tax rate differential |  |  | (10,487 | ) |  |  | (2,938 | )
Losses carried forward adjustment |  |  | - |  |  |  | (154 | )
Other differences |  |  | - |  |  |  | 20 |
Income tax provision |  | $ | 30,098 |  |  | $ | 6,002 |
The income tax expense comprises:
|  | Year ended March 31, 2021 |  |  | Year ended March 31, 2020 |
Current income tax charge |  | $ | 27,386 |  |  | $ | 5,307 |
Deferred income tax charge |  |  | 2,712 |  |  |  | 695 |
Income tax provision |  | $ | 30,098 |  |  | $ | 6,002 |
During the years ended March 31, 2021 and 2020, the Company realized net income before income tax of $173,022 and $28,132, respectively. During the same periods, the Company’s effective tax rate was equal to 17.4% and 21.34%, respectively. This decrease in income tax expense was primarily attributable to non-taxable gains on trading securities in Freedom KZ and Freedom Bank KZ. Tax losses carryforward as of March 31, 2021, was $316 in Uzbekistan.

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- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
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