Page 206 - TSMC 2019 Annual Report

Effect of tax rate changes on deferred income tax The origination and reversal of temporary differences Income tax credits
Income tax adjustments on prior years Other income tax adjustments
Income tax expense recognized in profit or loss
$
$
-
$
$
Years Ended December 31
2019
2018
(1,474,808) (3,072,554) (6,028,374)
47,162,957 (989,984)
152,884
46,325,857 (Concluded)
(1,065,068) (5,925,431)
44,346,110 196,882
(41,465) 44,501,527
Under the amendment to the R.O.C Statute of Industrial Innovation in 2019, the amounts of unappropriated earnings in 2018 and thereafter used for building or purchasing specific assets or technologies can qualify for deduction when computing the income tax on unappropriated earnings.
In 2018, the Income Tax Law in the R.O.C. was amended and, starting from 2018, the corporate income tax rate was adjusted from 17% to 20%. In addition, the tax rate for 2018 unappropriated earnings was reduced from 10% to 5%.
For other jurisdictions, taxes are calculated using the applicable tax rate for each individual jurisdiction.
b. Income tax expense recognized in other comprehensive income
Deferred income tax benefit (expense)
Related to remeasurement of defined benefit obligation Related to unrealized gain/loss on investments in equity
instruments at FVTOCI
Related to gain/loss on cash flow hedges
$ (20,992) The analysis of deferred income tax assets and liabilities was as follows:
December 31, 2019
Deferred income tax assets
Temporary differences
Depreciation
Refund liability
Net defined benefit liability
Unrealized loss on inventories
Deferred compensation cost
Investments in equity instruments at FVTOCI
Others 356,275
$ 17,928,358
Years Ended December 31
2019
$ (30,468)
9,476 -
2018
$ 103,339
91,828 562
$ 195,729
December 31, 2018
$ 11,839,221 2,594,003 1,084,874 750,995 271,711 56,191 209,392
$ 16,806,387 (Continued)
c. Deferred income tax balance
$ 13,547,220 2,150,352 1,016,248 469,430 323,093 65,740
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