Note 14 - Tax

The Company is a foreign corporation that is not subject to United States federal income taxes. Further, the Company is not subject to income taxes imposed by the Marshall Islands, the country in which it is incorporated, and there are no U.S. legal entities. The Monegasque company, DHT Management S.A.M., is subject to income taxation in Monaco, the Norwegian management company, DHT Management AS, is subject to income taxation in Norway and the subsidiaries in Singapore, DHT Ship Management (Singapore) Pte. Ltd., DHT Chartering (Singapore) Pte. Ltd. and DHT Management Pte. Ltd., are subject to income taxation in Singapore. The tax effects for the companies are disclosed below.

Specification of income tax:

(Dollars in thousands)	2020		2019			2018
Income tax payable	$	587	$	111		$	74
Tax expenses related to previous year		309		32			1
Change in deferred tax		5		(12	)		8
Total income tax expense	$	900	$	131		$	83

Specification of temporary differences and deferred tax:

(Dollars in thousands)	December 31, 2020			December 31, 2019			December 31, 2018
Property, plant and equipment	$	2		$	(13	)	$	(164	)
Pensions		(612	)		(420	)		(539	)
Total basis for deferred tax		(610	)		(432	)		(703	)
Deferred tax liability(asset), net ⁽¹⁾⁽²⁾	$	(140	)	$	(102	)	$	(155	)
Deferred tax (asset), gross⁽³⁾		(161	)		(126	)		(155	)
Deferred tax liability, gross⁽³⁾		21			24			-

⁽¹⁾	Due to materiality, recognized in prepaid expenses and not on a separate line in the statements of financial position.

⁽²⁾	The general income tax rate is reduced from 23% to 22%, effective from fiscal year 2019, and reduced from 24% to 23%, effective from fiscal year 2018.

⁽³⁾	Deferred tax liability is related to the subsidiary in Singapore and cannot be offset with the deferred tax asset related to the subsidiary in Norway.

Reconciliation of effective tax rate:

(Dollars in thousands)	2020		2019		2018
Profit/(loss) before income tax	$	267,181	$	73,812	$	(46,845	)
Expected income tax assessed at the tax rate for the Parent company (0%)		-		-		-
Adjusted for tax effect of the following items:
Income in subsidiary, subject to income tax		900		131		83
Total income tax expense	$	900	$	131	$	83