(6) Income Taxes


 

 

€k

 

2008/2009

2007/2008

Ongoing taxes on income and profit

–43,359

–56,567

Deferred tax income and expenses

–6,261

2,241

 

–49,620

–54,326

The amounts shown above for ongoing taxes on income and profit relate, within Germany, to corporate income tax and municipal corporate income tax, plus proceeds from partial release of tax accruals made during the previous year and, in the case of foreign subsidiaries, income-related taxes calculated in accordance with the national tax legislation applicable to the individual companies.

Deferred taxes (Glossary in the amount of –€1,311k (2007/2008: €1,283k) have been recorded in equity without any effect on profit and loss. They result from the market valuation of the cash flow (Glossary hedges.

The deferred taxes are the result of time-related variances in reported values between the tax accounts of individual companies and the values of the Group financial statements, using the liability method, plus capitalization of tax losses capable of being carried forward. In Germany, tax losses carried forward may be utilized for an indefinite period of time. In reviewing the amount of a deferred tax asset recognized in the balance sheet, it is crucial to assess whether it is probable that temporary differences will reverse and tax losses carried forward will be utilized, being the basis for the recognition of deferred tax assets. This is dependent on future taxable profits arising in those periods when taxable temporary differences reverse and tax losses carried forward may be utilized. Based on past experience and the projected development of taxable profit, Wincor Nixdorf assumes that the corresponding benefits associated with deferred tax assets will be realized. A deferred tax asset will be recognized to the extent that it is probable that future taxable profit will allow the deferred tax asset to be recovered. As of September 30, 2009, tax losses carried forward in the amount of €14,713k (2007/2008: €10,361k) have not been capitalized.

Any dividends payable in the future of Wincor Nixdorf AG will have no effect upon the Group’s tax charges.

Actual tax expenses are €610k above those which would be expected to be arrived at through the application of the ultimate parent company’s tax rate. Last year, actual tax proceeds were €34k above those which could have been expected.

As of September 30, 2009, unchanged to the previous year, all German deferred taxes were calculated in respect of temporary differences using a combined tax rate of rounded 30%. The reported value of all deferred taxes on tax losses carried forward was arrived at by using tax rates as in the previous year of 14% for municipal corporate income tax and 16% for corporation tax and solidarity tax.

The table below contains a reconciliation of expected net tax expenses with the actual reported tax:

 

 

€k

 

2008/2009

2007/2008

Profit before tax

163,365

180,973

 

 

 

Expected tax expenses based on a tax rate of 30%

–49,010

–54,292

Differences from expected tax expenses

 

 

Difference from local tax rates

3,231

5,687

Difference arising from change of deferred tax rate and income tax rate

–21

646

Increases/decreases in tax due to tax-exempt income and non-tax-deductible expenses

–4,851

–5,103

Consolidation entries excl. deferred taxes or with differing tax rates

–432

421

Corrections relating to other periods and other effects

2,838

–1,355

Non-recognition of deferred taxes on current losses

–1,375

–1,701

Recognition of previously unrecognized tax losses carried forward

0

1,371

Total adjustments

–610

–34

Actual tax expenses

–49,620

–54,326

The effective tax rate is 30.4% (2007/2008: 30.0%).

The deferred tax assets and liabilities relate to the following balance sheet items:

 

 

 

 

€k

 

Sept. 30, 2009

Sept. 30, 2008

 

Deferred tax assets

Deferred tax liabilities

Deferred tax assets

Deferred tax liabilities

Intangible assets

110

44,319

126

41,196

Tangible assets

1,724

1,307

1,355

1,606

Investments

14

0

0

0

Inventories

13,319

788

16,604

9,435

Receivables and other current assets

4,109

2,645

11,587

2,077

Pension accruals

10,357

498

7,406

166

Other accruals

17,372

934

25,229

157

Liabilities

4,536

774

5,829

2,364

Losses carried forward

4,772

0

3,867

0

 

56,313

51,265

72,003

57,001

Netting off of deferred tax assets and liabilities

–33,657

–33,657

–53,609

–53,609

 

22,656

17,608

18,394

3,392

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