ÇHS AR21-ENG-030622

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 DECEMBER 2021 ÇELEBİ HAVA SERVİSİ ANONİM ŞİRKETİ AND ITS SUBSIDIARIES (Amounts expressed in Turkish Lira (“TL”) unless otherwise indicated.) 108 Çelebi Ground Handling Inc. 2021 Annual Report Reconciliation of tax expenses presented in consolidated statements of income for the periods ended 31 December 2021 and 2020 are as follows: 2021 2020 Profit before tax in the financial statements 630.035.899 (133.077.282) Expected tax expense according to parent company tax rate (157.508.973) 29.277.001 Differences in tax rates of subsidiaries (1.635.997) (16.260.997) Expected tax expense of the Group (159.144.970) 13.016.004 Non-deductible expenses (11.735.833) (3.782.563) Reductions 27.855.134 4.095.778 Offset previous year profit loss 49.503.059 - Tax incentive effect (*) 2.230.859 - Investments accounted using the equity method effect 1.101.115 936.562 Deferred tax income calculated over unused previous years’ losses 2.350.173 8.191.198 Temporary tax effect not calculated on legal loss - (34.674.858) The effect of non-temporary differences 54.025.854 - Effect of non-monetary items translated from TL to Euro under TAS 21 (27.165.395) - Other (4.132.498) (4.650.895) Current period tax expense of the Group (65.112.502) (16.868.774) (*) The Company was entitled to receive a corporate income tax incentive from the Ministry of Economy for its investments in Istanbul Airport. At present, TL 217.352.779 of the total investment amounting to TL 57.171.594 has been granted and TL 22.079.486 of this amount has been deducted from the temporary tax amount calculated. Deferred taxes The Group calculates deferred tax assets and liabilities on temporary differences on statement of financial position items arising from different evaluation of financial statements prepared in accordance with TAS and statutory accounting standards. In general, such temporary differences are resulted from accounting of income and expenses in different reporting periods in accordance with Tax laws and TAS accounting standards. Rates for deferred tax assets and liabilities calculated by liability method over temporary differences to be realized in future periods are 20% - 23%, 9%, 31,925% and 25,17% for Turkey, Hungary, Germany and India, respectively.