Note 15 - (Income Tax Income)/Provision for Income Taxes

12 Months Ended

May. 31, 2015

Notes

Note 15 - (Income Tax Income)/Provision for Income Taxes

NOTE 15 – (INCOME TAX INCOME)/PROVISION FOR INCOME TAXES

	2015	2014
Current income tax in PRC and Hong Kong	$72,761	$22,819
Overprovision in prior year	-	(112,110)
Deferred income tax income	(4,759)	(15,071)
Total	$68,002	$(104,362)

On April 29, 2014, RTSH obtained a tax benefit which the income tax for 2013 and 2014 calendar year is exempt and the income tax for 2015, 2016 and 2017 calendar year will be subject to half rate deduction. Accordingly, provision for income tax of $112,110 for the period from January 1, 2013 to May 31, 2013 that included in last year’s income tax expenses was reversed as an income tax income during the year.

A reconciliation of the expected tax with the actual tax expense is as follows:

	2015	2014
Income before provision for income taxes	$(1,222,542)	$1,190,068
Expected PRC income tax expense at statutory tax rate of 25%	(305,636)	297,517
Different tax rate for PRC/Hong Kong local authority	9,649	29,058
Expenses not deductible for tax	241,114	24,566
Income not subject to tax	(34,449)	(301,875)
Overprovision in prior year	-	(112,110)
Utilization of tax loss brought forward	(105)	(69,447)
Tax loss not provided for deferred tax	157,429	27,929
Total	$68,002	$(104,362)

 (i) All PRC subsidiaries are subject to PRC tax. The provision for PRC income tax is based on a statutory rate of 25% of the assessable income of the PRC subsidiaries as determined in accordance with the relevant income tax rules and regulations of the PRC.

(ii) Hong Kong subsidiaries are subject to Hong Kong profits tax. The provision for Hong Kong profits tax is based on a statutory rate of 16.5% of assessable profits in Hong Kong.