Note 19 – Income tax

Group Parent Company
SEK m 2016 2015 2016 2015
Current tax for the year -72 -81 0 0
Current tax attributable to previous years 0 2 0
Deferred tax attributable to previous years 0 -3 0
Deferred tax -35 -32 -35 -27
Tax on net income for the year -107 -114 -35 -27
Of which discontinued operations -1
Continuing operations -107 -113 -35 -27

Deferred tax in the income statement consists of the following items:

Group Parent Company
SEK m 2016 2015 2016 2015
Deferred tax, internal profit on inventories 0 1
Deferred tax, untaxed reserves -4 -5
Deferred tax, appraised loss carry-forwards -36 -29 -36 -27
Deferred tax, other 4 -2 1 0
Total deferred tax -35 -35 -35 -27

 

The tax attributable to components in other comprehensive income amounts to SEK -8 m (2015: SEK -4 m), most of which comprises tax on reappraisal of the net pension obligation.

Income tax on the Group’s income before tax differs from the theoretical amount which would have arisen upon use of a weighted average tax rate for income in the consolidated companies in accordance with the following:

Group Parent Company
SEK m 2016 2015 2016 2015
Reported income before tax, continuing operations 441 459 214 148
Tax according to applicable tax rate -108 -113 -47 -33
Tax effect of non-deductible expenses -3 -1 -23 -23
Tax effect of non-taxable income 4 1 35 28
Effect of foreign tax rates 0 0 0 0
Tax income/expenses due to changed tax rate 0 0 0
Adjustments relating to previous years 0 -1 0
Tax on net income for the year in accordance with the income statement, continuing operations -107 -113 -35 -27

Tax rate

The weighted average tax rate in the Group amounted to 24.5% (2015: 24.6%). The Parent Company’s applicable income tax rate is 22% (2015: 22%).

Temporary differences

Temporary differences arise in those cases where the reported values and tax values of assets or liabilities differ. Changes are in deferred tax assets and liabilities during the year, without consideration being given to set-offs made under the same tax law.

Deferred tax assets

SEK, Group Loss carry-forwards Internal profit Pensions Structural expenses Other* Total
Per December 31, 2014 86 0 25 11 16 139
Reported in income statement -29 1 -5 -6 -39
Effect of changed tax rates reported in the income statement 0
Reported in other comprehensive income -4 -4
Exchange rate differences 0 0 0
Per December 31, 2015 57 1 21 6 10 96
Reported in income statement -36 0 -1 -1 -38
Effect of changed tax rates reported in the income statement 0
Reported in other comprehensive income 8 8
Acquired tax asset 0 0
Exchange rate differences -2 2 0
Per December 31, 2016 19 0 29 5 11 65
*”Other” relates, among other things, to deferred tax on bad debts and provisions for restructuring expenses.

As regards the valuation of loss carry-forwards, see Note 4.1. It is the management’s assessment that it will be possible to utilize the loss carry-forwards.

Deferred tax liabilities

SEK m, Group Untaxed reserves Intangible assets Other Total
Per December 31, 2014 27 76 19 122
Reported in income statement 5 -10 2 -3
Effect of changed tax rates reported in the income statement 0
Acquired tax liability 0
Exchange rate differences 0 -1 -1
Per December 31, 2015 32 66 19 117
Reported in income statement 4 -8 1 -3
Effect of changed tax rates reported in the income statement 0
Acquired tax liability 9 0 9
Exchange rate differences 3 0 3
Per December 31, 2016 36 70 20 126

“Intangible assets” refers to deferred tax on acquired customer relations. “Other” refers, among other thing, to deferred tax on differences between carrying amounts and value according to plan of fixed assets.

The deferred tax is valued in accordance with the applicable tax rate in each country.

Deferred tax assets Deferred tax liabilities
SEK m, Parent Company
Loss carry-forwards* Structural expenses Financial instruments Total Financial instruments
Per December 31,  2014 82 6 0 87 0
Reported in income statement -27 0 0 -27
Reported in other comprehensive income 0
Exchange rate differences 0 0
Per December 31, 2015 54 6 0 60 0
Reported in income statement -36 -1 2 -35 0
Reported in other comprehensive income 0
Exchange rate differences 0 0
Per December 31, 2016 18 4 2 24 0
*All loss carry-forwards in the Parent Company are perpetual.

Deferred tax assets and liabilities are set off when there is a legal right of set-off for the relevant tax assets and liabilities and when deferred taxes relate to the same tax authority. No set-off has taken place.

Reporting of expiration dates:

Group Parent Company
SEK m 2016 2015 2016 2015
Deferred tax assets
Utilized after more than 12 months 30 65 0 30
Utilized within 12 months 35 31 24 30
Total 65 96 24 60
Deferred tax liabilities
Utilized after more than 12 months 96 107
Utilized within 12 months 30 10
Total 126 117 0 0

The net change regarding deferred taxes is as follows:

Group Parent Company
SEK m 2016 2015 2016 2015
Opening balance -21  17 60 87
Reported in income statement -35 -36 -35 -27
Effect of changed tax rates reported in the income statement
Reported in other comprehensive income 8 -4
Acquired tax liability -9
Exchange rate differences -3 1 0 0
Closing balance -61 -21 24 60