Annual Report 2020-2021

70 PAGE

NOTES TO FINANCIAL STATEMENTS 30 June 2021

20. INCOME TAX EXPENSE

2021 $

2020 $

Tax expense comprises: Current tax expense

-

-

For the financial year ended 30 June 2021, less than 50% of the Club’s gross takings are from its Voting Members. As such, the Club did not meet the 50% threshold requirements under Section 11(1) of the Singapore Income Tax Act (“SITA”). In this regard, the provisional income tax computation has been prepared on the basis that the Club is deemed to be carrying on a business and will be taxed on its operating surplus (total receipts of income less tax-deductible operating expenses), in addition to income from other sources derived from dealings with non- members, such as interest income. The total charge for the year can be reconciled to the accounting loss as follows:

2021 $

2020 $

(531,261)

(5,677,444)

Loss before tax

Income tax credit at statutory rate (2020 : 17%) Non-deductible items

(90,315)

(965,165)

934,843

914,530

Effect of revenue that is exempt from taxation

(272,259) (572,269)

-

Utilisation of deferred tax assets not recognised

-

Effect of unused tax losses not recognised as deferred tax assets

-

50,635

-

-

21. CAPITAL COMMITMENTS

2021 $

2020 $

Amounts approved and not contracted for

1,670,351

1,340, 571

Amounts approved and contracted for

84,677

273,350

22. COVID-19 IMPACT The outbreak of COVID-19 in early 2020 has caused disruptions to many industries globally. Despite the challenges, governments and international organisations have implemented a series of measures to contain the pandemic. The Club will closely monitor the development of the pandemic and assess its impact on its operations continuously. Notwithstanding this, management has assessed that the Club is still able to maintain sufficient liquidity, to enable the Club to continue as a going concern for at least the next 12 months from the date of these financial statements.

THE AMERICAN CLUB SINGAPORE