4. Income taxes (Tables)

12 Months Ended

Dec. 31, 2016

Components of provision for income taxes

Loss before income taxes:

	2016			2015			2014
	US$’000			US$’000			US$’000
The PRC and Hong Kong		(640	)		(1,904	)		(879	)

The provision / (credit) for income taxes consist of:

	2016		2015			2014
	US$’000		US$’000			US$’000
Current tax expenses:
The PRC and Hong Kong		212		(72	)		8
Total current provision / (credit)		212		(72	)		8
Deferred tax expenses:
The PRC and Hong Kong		16		25			10
Total deferred provision		16		25			10

Reconciling items from income tax

	2016			2015			2014
	US$’000			US$’000			US$’000
Computed tax using respective companies’ statutory tax rates		(136	)		(177	)		(194	)
Change in valuation allowances		350			455			93
Under-provision for income tax in prior years		-			(69	)		-
Non-deductible expenses		14			(256	)		119
Total provision / (credit) for income tax at effective tax rate		228			(47	)		18

Components of deferred tax assets

	2016			2015
	US$’000			US$’000
Tax losses		838			1,159
Temporary differences		(2	)		1
Less: Valuation allowances		(650	)		(958	)
Net deferred tax assets		186			202

ZHEJIANG JIAHUAN

Components of provision for income taxes

	2016		2015		2014
	RMB’000		RMB’000		RMB’000
Income taxes		1,387		861		484

Reconciling items from income tax

	2016			2015			2014
	RMB’000			RMB’000			RMB’000
Income before income taxes		11,849			5,797			5,194
Computed tax using respective companies’ statutory tax rates		2,326			1,119			1,299
Tax effect on revenue not subject to tax		(930	)		(447	)		(537	)
(Over) / under provision for income tax in prior years		(9	)		189			(278	)
Total provision for income tax at effective tax rate		1,387			861			484

ZHEJIANG TIANLAN

Components of provision for income taxes

	2016			2015			2014
	RMB’000			RMB’000			RMB’000
Current PRC EIT:
Domestic		6,298			3,351			2,159
Income taxes		6,298			3,351			2,159
Deferred tax benefit:		(1,337	)		(177	)		(1,391	)
Total deferred taxes		(1,337	)		(177	)		(1,391	)

Reconciling items from income tax

	2016			2015			2014
	RMB’000			RMB’000			RMB’000
Income before income taxes		27,603			24,927			14,776
Computed tax using respective companies’ statutory tax rates		4,078			3,767			2,216
(Over)-provision for income tax in prior years		57			-			(2,418	)
Permanent difference		(82	)		-			-
Temporary differences		(1,337	)		(177	)		1,575
Tax effect of revenue not subject to tax		(901	)		(1,068	)		(695	)
Tax effect of expenses not deductible for tax purposes		2,732			596			90
Tax effect of unused tax losses not recognized		414			56			-
Total provision for income tax at effective tax rate		4,961			3,174			768

Components of deferred tax assets

	2016		2015
	RMB’000		RMB’000
Tax losses		-		-
Allowance for doubtful debts		5,864		4,527
Net deferred tax assets		5,864		4,527