15. Deferred tax

Deferred tax is recognised with regard to temporary differences between the carrying amounts of assets and liabilities in the IFRS consolidated financial statements and the corresponding amounts used for tax purposes. Deferred tax is not recognised for:

  • temporary differences on the first-time recognition of assets or liabilities in the event of a transaction that is not a business combination and that affects neither net earnings before taxes nor taxable income,
  • temporary differences in connection with shares in subsidiaries, and jointly controlled entities, provided the Group is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future, and
  • taxable temporary differences on the first-time recognition of goodwill.

The calculation of deferred tax is based on the specific tax rates of each country, which were between 5 and 25 per cent in the financial year (2016: between 9 and 25 per cent). Changes in tax rates in effect at 31 December 2017 are taken into account.

Deferred tax assets and debts are netted out if the conditions for a legal claim to offsetting are met and the deferred tax claims and liabilities relate to income tax that is levied by the same tax authority, either for the same taxable item or for different taxable items, aimed at achieving a settlement on a net basis.

Deferred tax assets are tested for impairment on every reporting date and reduced to the extent that it is no longer probable that the associated tax advantage will be realised.

At 31 December 2017 UNIQA had deferred tax assets amounting to €169,379 thousand (2016: €190,278 thousand), of which €14,428 thousand (2016: €9,716 thousand) were attributable to tax loss carryforwards. The deferred tax assets result from tax loss carryforwards, from impairment in accordance with Section 12 of the Austrian Corporation Tax Act, and from deductible temporary differences between the carrying amounts of the assets and liabilities in the consolidated statement of financial position and their tax values.

An assessment of the ability to realise deferred tax assets for tax losses not yet used, tax credits not yet used and deductible temporary differences requires an estimate of the amount of future taxable profits. The resulting forecasts are based on business plans that are prepared, reviewed and approved using a uniform procedure throughout the Company. Especially convincing evidence regarding the value and future chance of realisation of deferred tax assets is required under internal Group policies if the relevant Group company has suffered a loss in the current or a prior period.

The differences between the tax carrying amounts and the carrying amounts in the IFRS consolidated statement of financial position have the following effect:

In € thousand

31/12/2017

31/12/2016

Deferred tax assets (gross)

 

 

Technical items

48,526

49,174

Investments

44,409

48,266

Actuarial gains and losses on defined benefit obligations

52,747

76,336

Loss carried forward

14,428

9,716

Other items

9,269

6,786

Total

169,379

190,278

 

 

 

Deferred tax liabilities (gross)

 

 

Technical items

–278,243

–257,393

Investments

–149,712

–167,668

Actuarial gains and losses on defined benefit obligations

–246

0

Other items

–44,747

–56,304

Total

–472,949

–481,365

Net deferred tax

–303,570

–291,087

The deferred tax assets and deferred tax liabilities stated in the consolidated statement of financial position performed as follows:

In € thousand

Net deferred tax

At 1 January 2016

–321,581

Changes recognised in profit/(loss)

27,977

Changes recognised in other comprehensive income

–23,203

Changes due to changes in basis of consolidation

37

Reclassifications held for sale

25,736

Foreign exchange differences

–53

At 31 December 2016

–291,087

At 1 January 2017

–291,087

Changes recognised in profit/(loss)

–26,116

Changes recognised in other comprehensive income

25,105

Changes due to changes in basis of consolidation

–10,788

Foreign exchange differences

–685

At 31 December 2017

–303,570

Changes recorded in other comprehensive income essentially relate to measurements of financial instruments available for sale and revaluation of defined benefit obligations.

Deferred tax assets from loss carryforwards in the amount of €24,808 thousand (2016: €23,905 thousand) were not recognised, as a realisation of these in the near future cannot be assumed, taking maturities into account.

These tax assets from loss carryforwards are forfeited as follows:

In € thousand

31/12/2017

31/12/2016

Up to 1 year

1,434

662

2 to 5 years

63,757

23,681

More than 5 years

174,365

152,937

Total

239,556

177,280

Associates
Associates are all the entities over which UNIQA has significant influence but does not exercise control or joint control over their financial and operating policies. This is generally the case as soon as there is a voting share of between 20 and 50 per cent or a comparable significant influence is guaranteed legally or in practice via other contractual regulations.