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A&T BANK 2014 FAALİYET RAPORU
Convenience Translation of Publicly Announced Consolidated Fınancial
Statements Originally Issued in Turkish, See Note I of Section Three
Arap Türk Bankası A.Ş.
Notes to Consolidated Financial
Statements at 31 December 2014
(Amounts expressed in thousands of Turkish Lira (“TL”) unless otherwise stated.)
ANNU L R PORT 2014
In applying the withholding tax rates on dividend payments to the non-resident institutions and the individuals, the withholding tax rates
covered in the related Double Tax Treaty Agreements are taken into account. Appropriation of the retained earnings to capital is not
considered as profit distribution and therefore is not subject to withholding tax.
The prepaid taxes are calculated and paid at the rates valid for the earnings of the related years. The payments can be deducted from
the annual corporate tax calculated for the whole year earnings.
Tax losses can be carried forward for a maximum period of five years following the year in which the losses were incurred. Tax losses
cannot be carried back.
In Turkey, there is no procedure for a final and definite agreement on tax assessments. Companies file their tax returns with their tax
offices by the end of 25th of the fourth month following the close of the accounting period to which they relate. Tax declarations and
related accounting entries can be investigated by tax authorities for five years from the beginning of the year that follows the date of
filing during which time the tax authorities have the right to audit tax returns, and the related accounting records on which they are
based, and may issue re-assessments based on their findings.
Investment incentive
Investment incentive certificates which are obtained prior to April 24, 2003, can deduct 19.8% investment allowance tax withholding.
After this date, encouraging, undocumented activities directly related to the investment expenses of companies can deduct 40%.
There is no withholding tax for The investments without investment incentive certificates.
As the matter of fact, the Group’s subsidiary which operates in the leasing sector has taken advantage of the investment allowances
while arranging the corporate tax returns for the year 2014 that are not depended on withholdings. The investment allowances were
gained during the incentive certificateless investment expenses after 24 April 2003.
Deferred taxes
The Group calculates and accounts deferred tax assets and liabilities in accordance with the TAS 12-Income Taxes; deferred tax
assets and liabilities are recognized on all taxable temporary differences arising between the carrying values of assets and liabilities
in the consolidated financial statements and their corresponding balances used for taxation purposes except for the differences not
deductible for tax purposes and initial recognition of assets and liabilities which affect neither accounting nor taxable profit.
If transactions and events are recorded in the statement of income, then the related tax effects are also recognized in the statement
of income. However, if transactions and events are recorded directly in the shareholders’ equity, the related tax effects are also
recognized directly in the shareholders’ equity.
The net amount of deferred tax receivables and deferred tax payables is shown on the financial tables.
Transfer Pricing
In Turkey, the transfer pricing provisions has been stated under the Article 13 of Corporate Tax Law with the heading of “disguised
profit distribution via transfer pricing”. The General Communiqué on disguised profit distribution via Transfer Pricing, dated
18 November 2007 sets details about implementation.
If the companies enter into transactions concerning to the sale or the purchase of the goods or services with the related parties by
setting the prices or amounts which are not in line with the arm’s length principle, related profits will be treated as having been wholly
or partially distributed in a disguised way via transfer pricing. This kind of disquised profit distribution via transfer pricing cannot be
deducted from tax base in accordance with corporate tax.