MILLIRE_2019_Annual Report

Milli Re Annual Report 2019 162 Millî Reasürans Türk Anonim Şirketi NOTES TO THE UNCONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2019 (Currency: Turkish Lira (TL)) (Convenience Translation of Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish, See Note 2.1.1) 33 Employee benefit expenses As of December 31, 2019 and 2018, employee benefit expenses are disclosed as follows: December 31, 2019 December 31, 2018 Life Non-Life Life Non-Life Wages and salaries 513.595 42.928.532 572.422 38.880.258 Employer’s share in social security premiums 141.764 10.475.757 128.864 7.687.682 Pension fund benefits 72.087 5.290.708 85.245 4.959.750 Total (Note 32) 727.446 58.694.997 786.531 51.527.690 34 Financial costs As of December 31, 2019, TL 44.377 interest expense arising from leases that the Company is subject to TFRS 16 Leasing Transactions standard is recognised under “Investment Management Expenses - Interest Included” account; and the depreciation expense amounting to TL 1.463.920 is recognised under the “Depreciation and Amortization Expense” accounts (1 January - 31 December 2018: None). 35 Income tax Income tax expense in the accompanying financial statements is as follows: December 31, 2019 December 31, 2018 Corporate tax expense: Corporate tax provision (37.227.141) (27.682.983) Deferred taxes: Origination and reversal of temporary differences 9.740.590 1.814.922 Total income tax expense/income (27,486,551) (25,868,061) For the period then ended as of December 31, 2019 and 2018, a reconciliation of tax expense applicable to profit from operating activities before income tax at the statutory income tax rate to income tax expense at the Company’s effective income tax rate is as follows: Profit before taxes December 31, 2019 December 31, 2018 339.997.16 5 Tax rate (%) 304.081.473 Tax rate (%) Taxes on income per statutory tax rate 74.799.376 22,00 66.897.924 22,00 Tax exempt income (57.514.265) (16,92) (49.106.105) (16,15) Non-deductible expenses 10.201.440 3,00 8.076.242 2,66 Total tax expense recognized in profit or loss 27.486.551 8,08 25.868.061 8,51 36 Net foreign exchange gains Net foreign exchange gains are presented in Note 4.2 - Financial Risk Management above.