f. Deposits pledged as collateral to loans granted by the Bank as of 31 December 2022 and 2021 (Note 12) were as follows:
2022 2021
Demand deposits 3,760,813 2,915,101
Savings 1,307,695 1,257,037
Time deposits 10,489,293 10,076,423
15,557,801 14,248,561
Information on the classification and fair value of deposits from customers and other banks is disclosed in Note 38. Information on the maturity of deposits from customers and other banks is disclosed in Note 44.
20. INCOME TAX
c. Tax expenses
2022 2021
Current tax:
Current year
Bank 9,804,547 7,577,746
Subsidiaries 614,806 574,417
10,419,353 8,152,163
Deferred tax:
Origination (recovery) of temporary differences
Bank (777,705) (717,850)
Subsidiaries 69,813 (33,298)
(707,892) (751,148)
9,711,461 7,401,015
d. Through Law number 7 of 2021 dated 29 October 2021 concerning Harmonisation of Tax Regulations, Taxpayers can obtain a reduction in PPh rates of 3% (three percent) lower than the domestic Corporate Taxpayer PPh rate as stipulated in article 17 paragraph 1 letter b, Chapter III regarding Income Tax, so that the rate becomes 19% for 2022 and 2021, if it meets the following criteria:
1. In the form of a public company.
2. With the total of paid-up shares traded on the stock exchange in Indonesia at least 40% (forty percent).
3. Fulfill certain requirements.
The certain requirements are regulated in article 65, Government Regulation number 55 of 2022, regarding Adjustments to Regulations in the Field of Income Tax, dated 20 December 2022, as follows:
1. The public owned 40% (forty percent) or more of the total paid up shares and those shares are owned by at least 300 (three hundred) parties.
2. Each party can only own less than 5% (five percent) of total paid -up shares.
3. The taxpayer should fulfill the above mentioned criteria at least within 183 (one hundred and eighty three) calendar days in 1 (one) fiscal year.
4. Parties that meet the requirements of 300 (three hundred) parties and 5% (five percent) as stated above, do not include:
a. Public Company Taxpayers who buy back their shares; and/or
b. Those who have a special relationship as stipulated in the Income Tax Law with Public Company Taxpayers.
Fulfilment of these requirements is carried out by Public Company Taxpayers by submitting reports to the Directorate General of Taxes, including: monthly reports of share ownership of issuers or public companies and recapitulation that has been report ed from the Securities Administration Bureau.
On 4 January 2023 and 6 January 2022, the Bank received a declaration letter from the Securities Administration Bureau for the fulfilment of the above criteria for fiscal year 2022 and 2021, respectively.
e. The reconciliation of consolidated accounting income before tax and taxable income of the Bank was as follows:
2022 2021
Consolidated accounting income before tax 50,467,033 38,841,174
Elimination 1,731,840 2,101,643
Before elimination 52,198,873 40,942,817
Subsidiary’s accounting income before tax (3,202,631) (2,670,151)
Accounting income before tax - Bank only 48,996,242 38,272,666
Permanent differences:
Employees' welfare 23,883 203,791
Rent income (46,984) (45,254)
Dividends from Subsidiaries (1,702,184) (2,045,885)
Interest income from off-shore
government bonds (56,040) (61,927)
Other expense (income) which cannot be deducted
for tax calculation purposes - net 294,781 (218,675)
(1,486,544) (2,167,950)
Temporary differences:
Post-employment benefits obligation (65,051) (722,820) Allowance for Impairment losses on financial assets 3,327,238 3,406,123 Allowance for Impairment losses on
non-financial assets 91,444 247,544
Accrued employees' benefits 772,082 177,225
Unrealised losses of trading and
measured at fair value through profit or loss investment securities and placements with
other banks 2,831 9,137
Other income which cannot be deducted
for tax calculation purposes - net (35,362) 660,951
4,093,182 3,778,160
Taxable income 51,602,880 39,882,876
f. The reconciliation between consolidated accounting income before tax multiplied by the applicable maximum tax rate and income tax expense was as follows:
2022 2021
Consolidated accounting income before tax 50,467,033 38,841,174
Maximum tax rate 22% 22%
11,102,747 8,545,058
Permanent differences at 22% - Bank (327,040) (476,950) Permanent differences at 22% - Subsidiaries 361,045 416,047
11,136,752 8,484,155
Adjustment of corporate income tax rate -
Bank (Note 20d) (1,425,291) (1,083,140)
Income tax expense - consolidated 9,711,461 7,401,015
g. The calculation of current tax and income tax payable were as follows:
2022 2021
Taxable income:
Bank 51,602,880 39,882,876
Subsidiaries 2,794,573 2,610,986
54,397,453 42,493,862
Current tax:
Bank 9,804,547 7,577,746
Subsidiaries 614,806 574,417
10,419,353 8,152,163
Prepaid income taxes:
Bank (8,924,007) (6,737,436)
Subsidiaries (450,924) (367,297)
(9,374,931) (7,104,733)
Income tax payable:
Bank 880,540 840,310
Subsidiaries 163,882 207,120
1,044,422 1,047,430
Annual Tax Return (“SPT”) of Corporate Income Tax for fiscal year 2022 has not yet been submitted. Taxable income results from reconciliation above is the basis in filling the Bank’s Annual Tax Return (“SPT”) of Corporate Income Tax for the year ended 31 December 2022.
The calculations of income tax for the year ended 31 December 2021 conform to the Bank’s Annual Tax Returns (“SPT”).
h. The significant items of deferred tax assets and liabilities as of 31 December 2022 and 2021 were as follows:
2021
Recognised in current year profit or loss
Recognised in current year other comprehensive
income 2022
Parent entity - Bank:
Post-employment benefits obligations 643,388 (12,359) - 631,029
Allowance for impairment losses
of financial assets 4,447,853 632,175 - 5,080,028
Allowance for impairment losses
of non-financial assets 96,245 17,375 - 113,620
Accrued employees’ benefits 557,110 146,696 - 703,806
Depreciation on fixed assets 14,369 (9,238) - 5,131
Unrealised gain (losses) on investment securities and placement with other banks measured at fair value through
other comprehensive income (1,420,618) - 999,574 (421,044)
Remeasurements of defined benefit
obligation 709,475 - 67,509 776,984
Unrealised gain (losses) on investment securities and placement with other banks measured at fair value through
profit or loss 179 538 - 717
Fiscal correction regarding SFAS 73 9,041 5,572 - 14,613
Others 204,209 (3,054) - 201,155
Deferred tax assets - net 5,261,251 777,705 1,067,083 7,106,039
h. The significant items of deferred tax assets and liabilities as of 31 December 2022 and 2021 were as follows: (continued)
2021
Recognised in current year profit or loss
Recognised in current year other comprehensive
income 2022
Deferred tax assets - net (brought forward) 5,261,251 777,705 1,067,083 7,106,039
Subsidiaries:
PT BCA Finance 82,868 (33,362) (468) 49,038
PT BCA Sekuritas 4,480 (674) (483) 3,323
PT Bank BCA Syariah 19,552 6,122 9,876 35,550
PT Asuransi Umum BCA 69,091 2,125 323 71,539
PT Asuransi Jiwa BCA 13,364 4,006 1,818 19,188
PT BCA Multi Finance 69,662 (34,185) (268) 35,209
PT Bank Digital BCA 682 461 302 1,445
PT Central Capital Ventura 4,566 (4,549) (17) -
Deferred tax assets - net 264,265 (60,056) 11,083 215,292
Total deferred tax assets - net 5,525,516 717,649 1,078,166 7,321,331
Deferred tax liabilities
Subsidiary:
PT Central Capital Ventura - 9,757 (17) 9,740
Total deferred tax liabilities - net - 9,757 (17) 9,740
2020
Recognised in current year profit or loss
Recognised in current year other comprehensive
income 2021
Parent entity - Bank:
Post-employment benefits obligations 780,724 (137,336) - 643,388
Allowance for impairment losses
of financial assets 3,800,690 647,163 - 4,447,853
Allowance for impairment losses
of non-financial assets 49,212 47,033 - 96,245
Accrued employees’ benefits 523,438 33,672 - 557,110
Depreciation on fixed assets 5,232 9,137 - 14,369
Unrealised gain (losses) on investment securities and placement with other banks measured at fair value through
other comprehensive income (1,638,239) - 217,621 (1,420,618)
Remeasurements of defined benefit
obligation 1,027,436 - (317,961) 709,475
Unrealised gain (losses) on investment securities and placement with other banks measured at fair value through
profit or loss (1,557) 1,736 - 179
Fiscal correction regarding SFAS 73 3,444 5,597 - 9,041
Others 93,361 110,848 - 204,209
Deferred tax assets - net 4,643,741 717,850 (100,340) 5,261,251
Subsidiaries:
PT BCA Finance 59,802 22,614 452 82,868
PT BCA Sekuritas 3,860 727 (107) 4,480
PT Bank BCA Syariah 15,477 4,421 (346) 19,552
PT Asuransi Umum BCA 61,445 6,973 673 69,091
PT Asuransi Jiwa BCA - 23,122 (9,758) 13,364
PT BCA Multi Finance 92,287 (22,730) 105 69,662
PT Central Capital Ventura 3,786 774 6 4,566
PT Bank Digital BCA 324 486 (128) 682
Deferred tax assets - net 236,981 36,387 (9,103) 264,265
Total deferred tax assets - net 4,880,722 754,237 (109,443) 5,525,516
Deferred tax liabilities
Subsidiary:
PT Asuransi Jiwa BCA 5,957 3,089 (9,046) -
Total deferred tax liabilities - net 5,957 3,089 (9,046) -