17. Income taxes

Income taxes include taxes on income paid or owed in the individual countries and deferred taxes. Income taxes consist of trade tax, corporation tax, solidarity surcharge and the equivalent foreign income taxes.

Income tax expense is made up by origin as follows:

Income taxes
  XLS Download

in EUR thousands

1/3/2013
–28/2/2014

1/3/2012
–28/2/2013

*

Amounts from the comparative period have been adjusted as a result of the retrospective application of IAS 19 (2011).

Current taxes

 

 

Current domestic taxes

–41,584

–69,107

Current foreign taxes

–53,219

–67,400

 

–94,803

–136,507

Deferred taxes

 

 

Deferred domestic taxes*

–4,326

–192

Deferred foreign taxes

4,748

12,057

 

422

11,865

Income taxes

–94,381

–124,642

The current income taxes affecting previous years had a positive effect on the net income to the amount of EUR 2,563 thousand.

The expected income tax expense which would have been payable if the tax rate for the parent company Nordzucker AG of 29.00 per cent (previous year: 29.00 per cent) were applied to the consolidated net income under IFRS before taxes and non-controlling interests can be reconciled with the income taxes in the income statement as follows:

Tax expense
  XLS Download

in EUR thousands

1/3/2013
–28/2/2014

1/3/2012
–28/2/2013

*

Amounts from the comparative period have been adjusted as a result of the retrospective application of IAS 19 (2011).

IFRS net profit before income taxes

303,107

493,316

Group tax rate in %

29.00

29.00

Expected tax expense*

–87,901

–143,062

Tax rate variances

19,291

23,724

Taxes for prior years

1,652

–4,909

Tax-free income

4,477

2,169

Non-deductible operating expenses for tax purposes

–31,919

–1,285

Other effects

19

–1,279

Tax expense

–94,381

–124,642

The corporation tax rate for stock corporations based in Germany is 15 per cent plus 5.5 per cent solidarity surcharge on the corporation tax liability.

Companies based in Germany are also liable for trade tax at a rate determined by multipliers set by the local council.

The effects of differences between foreign tax rates and the Group tax rate for Nordzucker AG (29.00 per cent) are shown in the reconciliation statement under tax rate differences between Germany and abroad. As a result of tax rate changes abroad, there was deferred income of EUR 5,028 thousand for the current financial year.

Deferred tax assets and liabilities result primarily from temporary valuation differences between the IFRS financial statements and the financial statements of the individual Group companies for local tax purposes for the following items:

Deferred taxes
  XLS Download

 

28/2/2014

28/2/2013

in EUR thousands

Deferred tax assets

Deferred tax liabilities

Deferred tax assets

Deferred tax liabilities

*

Amounts from the comparative period have been adjusted as a result of the retrospective application of IAS 19 (2011).

Intangible assets

38

8,010

443

10,202

Property, plant and equipment

1,863

116,962

2,490

124,278

Financial investments

0

0

0

0

Inventories

2,387

8,860

3,179

9,574

Other assets

395

1,059

459

1,991

Pension provisions*

14,856

0

18,993

0

Other provisions*

9,574

234

8,987

–2,098

Other liabilities

1,163

9,857

514

12,134

Deferred taxes on temporary differences

30,276

144,982

35,065

156,081

Deferred tax assets on tax loss carry-forwards

0

0

2,706

0

Gross amount

30,276

144,982

37,771

156,081

Netting

–28,647

–28,647

–19,843

–19,843

Balance sheet amount

1,629

116,335

17,928

136,238

The changes in deferred taxes as of the reporting date as shown in the consolidated balance sheet were recorded within profit or loss at EUR 422 thousand (i.e. in the income statement) and outside of profit or loss at EUR 3,182 thousand (i.e. in the statement of comprehensive income).

Deferred tax assets and liabilities are offset for each company or taxable entity. To the extent that deferred taxes relate to private partnerships, offsetting only takes place at the level of Nordzucker AG for corporation tax purposes. Deferred trade taxes are offset at the level of the individual private partnerships.

The following table shows the changes in deferred tax assets and deferred tax liabilities as shown both within and outside of profit or loss:

Deferred taxes
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1/3/2013–28/2/2014

1/3/2012–28/2/2013

in EUR thousands

Deferred tax assets

Deferred tax liabilities

Deferred tax assets

Deferred tax liabilities

*

Amounts from the comparative period have been adjusted as a result of the retrospective application of IAS 19 (2011).

Intangible assets

–405

2,192

384

1,865

Property, plant and equipment

–627

7,316

–5,933

11,715

Financial investments

0

0

–61

323

Inventories

–793

714

–413

57

Other assets

–10

932

–1,980

–589

Pension provisions*

–4,137

0

152

–508

Other provisions*

587

–2,331

2,216

–471

Other liabilities

596

2,276

–4,555

9,675

Deferred taxes on temporary differences

–4,789

11,099

–10,192

22,067

Deferred tax assets on tax loss carry-forwards

–2,706

0

–10

0

Total

–7,495

11,099

–10,202

22,067

With regard to the surplus of deferred tax assets over deferred tax liabilities at the level of individual companies in the balance sheet, the value of the deferred tax assets is considered to be sufficiently certain, based on the current earnings situation and/or business planning.

In the financial year, no deferred tax assets were recognised for foreign tax loss carry-forwards of EUR 3,976 thousand (previous year: EUR 4,594 thousand) as no positive taxable income is expected in the near future. Furthermore, no deferred tax assets were recognised for domestic tax loss carry-forwards of EUR 298 thousand (previous year: EUR 297 thousand) as no positive taxable income is expected in the near future.

No deferred tax assets were recognised for temporary differences on investments by subsidiaries of EUR 165,145 thousand (previous year: EUR 364,353 thousand) because the Nordzucker Group is able to control the timing of the reversal and the temporary differences will not be reversed in the foreseeable future.