PC3. Taxes

AP Accounting principles

Due to the links between accounting and taxation, the deferred tax liability on untaxed reserves is recognized in the company’s annual accounts as a component of untaxed reserves.

Tax expense

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Tax expenses
Tax expense (+), tax income (–)

SEKm

2017

2016

Deferred tax

–816

–230

Current tax

–

–

IS Total

–816

–230

Explanation of tax expense

The difference between the recognized tax expense and expected tax expense is explained below. The expected tax expense is calculated based on profit before tax multiplied by the current tax rate.

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2017

 

2016

Reconciliation

SEKm

%

 

SEKm

%

1)

Non-taxable and non-deductible Group contributions relate to repayment from/to the respective subsidiary, which amounts to 78% of the Group contribution.

IS Profit/loss before tax

1,680

 

 

–244

 

IS Tax expense/income

–816

–48.5

 

–230

–94.2

Expected tax

370

22.0

 

–54

–22.0

Difference

–1,186

–70.5

 

–176

–72.2

 

 

 

 

 

 

The difference is due to:

 

 

 

 

 

Taxes related to prior periods

–16

–0.9

 

–

0.0

Non-taxable dividends from subsidiaries

–934

–55.6

 

–

0.0

Non-taxable Group contributions from subsidiaries1)

–529

–31.5

 

–175

–71.7

Non-deductible Group contributions to subsidiaries1)

13

0.8

 

–

0.0

Other non-taxable/non-deductible items

280

16.7

 

–1

–0.5

Total

–1,186

–70.5

 

–176

–72.2

The Parent Company participates in the Group’s tax pooling arrangement and pays the majority of the Group’s total Swedish taxes. These are recognized in profit and loss as Group contributions paid and received. The net of given and received Group contributions per subsidiary amounts to 22% and is the respective subsidiary’s share of the tax cost for the Group.

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Current tax liability (+), tax asset (–)

SEKm

2017

2016

Value, January 1

–

–

Current tax expense

–

–

Paid tax

–4

–

BS Value, December 31

–4

–

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Deferred tax expense (+), tax income (–)

SEKm

2017

2016

Changes in temporary differences

–800

–230

Adjustments for prior periods

–16

0

Total

–816

–230

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Provisions for taxes

SEKm

Value, January 1

Deferred tax income

Value, December 31

Provisions for pensions

–176

–14

–190

Tax loss carryforwards

0

–1,016

–1,016

Other

–54

214

160

BS Total

–230

–816

–1,046

Appropriations and untaxed reserves

Accumulated depreciation in excess of plan totaling SEK 1m (–) is included in the Parent Company’s untaxed reserves.