Freedom Holding Corp. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

INCOME TAXES

INCOME TAXES

9 Months Ended

Dec. 31, 2020

NOTE 8 – INCOME TAXES

The Company is subject to taxation in the Russian Federation, Kazakhstan, Kyrgyzstan, Cyprus, Ukraine, Uzbekistan, Germany and the U.S.

The tax rates used for deferred tax assets and liabilities as of December 31, 2020, and March 31, 2020, is 21% for the U.S., 20% for the Russian Federation, Kazakhstan, and Kyrgyzstan, 31% for Germany, 12.5% for Cyprus, 18% for Ukraine and 15% for Uzbekistan. Deferred tax assets and liabilities of the Company are comprised of the following:

	December 31, 2020			March 31, 2020

*Deferred tax assets:*
Tax loss carryforwards	$	670		$	1,691
Accrued liabilities		231			7
Depreciation		-			4
Valuation allowance		(670	)		(677	)
Revaluation on trading securities		-			72
Deferred tax assets	$	231		$	1,097

*Deferred tax liabilities:*
Revaluation on trading securities	$	2,408		$	513
Depreciation		659			-
Subordinated debt		831			-
Other liabilities		13			14
Deferred tax liabilities	$	3,911		$	527

Net deferred tax assets/(liabilities)	$	(3,680	)	$	570

During the nine months ended December 31, 2020, and 2019, the effective tax rate was equal to 15.79% and 17.03%, respectively.

Tax loss carryforwards as of December 31, 2020, and March 31, 2020, were $670 and $1,691, respectively, and are subject to income tax in the U.S., Russian Federation, Ukraine and Uzbekistan.