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28. Income taxes

Major components of tax expenses/(income)
in thousand EUR   2020   2019
Current tax expenses/(income)   699   357
Deferred tax expenses/(income) relating to temporary differences   412   3 281
Total income taxes   1 111   3 638
Reconciliation of tax expenses/(income)
in thousand EUR   2020   2019
Earnings before tax   –1 070   11 611
Expected tax expenses/(income) based on a weighted average   –147   3 203
Derecognition of previously recognized deferred tax assets   759   1 539
Recognition of previously not recognized deferred tax assets     –2 633
Minimum tax in Gabon   434   405
Change in permanent differences   7   292
Non-deductible expenses   58   566
Other     266
Total income taxes   1 111   3 638

The weighted average applicable tax rate, considering all profit- and loss-making entities, was 28 % (2019: 28 %).

Deferred income tax
in thousand EUR   2020   2019
Total deferred tax assets   9 950   8 448
Total deferred tax liabilities   –16 164   –21 376
Net deferred tax assets/(liabilities)   –6 214   –12 928

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset them and when the deferred income taxes relate to the same tax authority.

Deferred income tax assets
in thousand EUR   2020   2019
Inventories   27   33
Tax loss carry-forwards   1 747   2 371
Provisions   113   180
Financial liabilities   7 348   5 062
Other   715   802
Total deferred tax assets   9 950   8 448
Deferred income tax liabilities
in thousand EUR   2020   2019
Property, plant and equipment   –12 481   –16 617
Biological assets   –3 455   –4 474
Intangible assets   –228   –285
Total deferred tax liabilities   –16 164   –21 376
 
Net deferred tax assets/(liabilities)   –6 214   –12 928
Reported in the balance sheet as follows:        
Deferred tax assets    
Deferred tax liabilities   –6 214   –12 928
Net deferred tax assets/(liabilities)   –6 214   –12 928

Net movement of the deferred income tax account is as follows:

in thousand EUR   2020   2019
At 1 January   –12 928   49
Income statement charge   –412   –3 281
Tax charged to other comprehensive income   3 996   –9 966
Currency effects   3 130   270
At 31 December   –6 214   –12 928

The Group did not recognize deferred income tax assets on deductible temporary differences of EUR 4.6 million (2019: EUR 5.1 million) and on unused tax losses of EUR 43.5 million (2019: EUR 65.7 million).

These unrecognized tax loss carry-forwards expire as presented in the table below:

in thousand EUR   2020   2019
0–2 years   36 668   17 674
3–4 years   954   28 851
5–7 years   2 681   366
over 7 years   3 237   18 764
Total tax loss carry-forwards   43 540   65 655

EUR 9.0 million of these tax loss carry-forwards belong to the Dutch operations of Precious Woods with an applicable tax rate of 19 % (2019: EUR 10.1 million with an applicable tax rate of 19 %), EUR 3.2 million belong to the Brazilian operations with an applicable tax rate of 34 % (2019: EUR 6.8 million with an applicable tax rate of 34 %), and EUR 31.3 million belong to the Swiss operation with an applicable tax rate of 11.91 % (2019: EUR 36.8 million with an applicable tax rate of 11.91 %). From the Gabonese operations no tax loss carry-forwards remain from 2020 (2019: EUR 11.9 million with an applicable tax rate of 30 %).

Accounting policies

The charge for current income tax is based on the results for the year as adjusted for items which are non-assessable or disallowed. It is calculated using tax rates for the countries where the Group has operations. Deferred income taxes are accounted for using the balance sheet liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the financial statements, and the corresponding tax basis used in the computation of taxable profit. Deferred income tax liabilities are generally recognized for all taxable temporary differences, and deferred income tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilized. Such assets and liabilities are not recognized if the temporary difference arises from the initial recognition of goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction, which, at the time of the transaction, affects neither the taxable profit nor the accounting profit.