Income Taxes comprise both ongoing and deferred taxes (Glossary) . Taxes are recorded in the Group income statement unless they refer to items directly recorded under shareholders’ equity, in which case the corresponding taxes are also entered under shareholders’ equity without any effect upon profit.
Ongoing income taxes are taxes expected to be payable for the year, on the basis of tax rates valid in the year in question, plus any tax corrections for previous years.
Deferred taxes are reported in respect of temporary differences between the values, for tax purposes, of assets and liabilities and their values in the Group financial statements. In addition, deferred tax assets in respect of the future utilization of tax losses carried forward are shown. Deferred tax assets on temporary differences and tax losses carried forward are recognized to the extent that it is probable that sufficient taxable income will be available in order to use them. The deferred taxes are shown at the rates of tax that will be effective under applicable law at the time at which the temporary differences are predicted to turn around, or at which the tax losses carried forward can probably be used.
Offsetting of deferred tax assets and deferred tax liabilities is performed if the positions are related to income taxes, which are levied by the same tax authorities, for which the Group has a legally enforceable right to set off the recognized amounts and which arise for the same companies or within the same tax group, respectively.
The remaining taxes, such as property and energy taxes, are included in the functional cost items.
