17. Deferred income tax

Deferred income tax assets and liabilities developed as follows in the fiscal year:

Deferred income tax assets and liabilities (excluding offsetting within individual tax jurisdictions) are as follows:

As at December 31, 2023, the amended regulations on the recognition of deferred taxes on assets and liabilities resulting from a single transaction will be applied for the first time. In accordance with the restrictions of the amendments to the “initial recognition exemption”, deferred taxes on leases and on receivables and liabilities from ABS and factoring are recognized on a gross basis. There are no effects on the consolidated balance sheet, as the deferred tax assets are netted against the deferred tax liabilities.

Deferred income tax assets are recognized for all deductible temporary differences between the carrying amounts of assets and liabilities in the Consolidated Statement of Financial Position and their tax bases to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences can be utilized. In both the current financial year and the previous year, a deferred income tax asset was recognized for all deductible temporary differences due to expected future taxable income.

The Group recorded tax losses in some subsidiaries in 2023 and in previous years. In total, the recognized deferred income tax assets on temporary differences and tax loss carryforwards for subsidiaries that have incurred tax losses in the current or previous fiscal year amount to EUR 10,238 thousand (2022: EUR 7,260 thousand). The tax losses of these subsidiaries are mainly attributable to special effects, in particular due to restructuring, so that it is assumed that the deferred tax assets can be realized due to taxable results expected in the future. Essentially, the deferred tax assets relate to loss carryforwards which can be carried forward indefinitely and have not expired.

The decrease in deferred income tax liabilities in the item “Borrowings” compared to the previous year is mainly due to the exchange rate development of a foreign currency liability at the level of NORMA Group Holding GmbH.

The decrease in deferred income tax liabilities in the item “Other assets” compared to the previous year mainly resulted from the exchange rate development of a foreign currency receivable at the level of NORMA Group Holding GmbH.

Deferred tax assets are recognized for tax loss carry forwards to the extent that it is probable that the tax assets will be realized in the foreseeable future. The usability of tax loss carry forwards over time is as follows:

The tax loss carry forwards amounted to EUR 164,094 thousand as at December 31, 2023 (Dec 31, 2022: EUR 122,298 thousand). Of this amount, EUR 64,072 thousand is attributable to German corporation tax loss carry forwards (Dec 31, 2022: EUR 52,021 thousand) and EUR 59,027 thousand to German trade tax loss carryforwards (Dec 31, 2022: EUR 44,479 thousand).

The usability of unrecognized tax loss carry forwards over time is as follows:

The tax loss carryforwards for which no deferred income tax assets were recognized as at December 31, 2023 amount to EUR 101,752 thousand on December 31, 2023 (Dec 31, 2022: EUR 34,601 thousand). Of this amount, EUR 49,968 thousand is attributable to German corporation tax loss carry forwards (Dec 31, 2022: EUR 14,500 thousand) and EUR 29,398 thousand to German trade tax loss carryforwards (Dec 31, 2022: EUR 5,936 thousand).

The interest carried forward for tax purposes amounted to EUR 10,619 thousand as at December 31, 2023 (Dec 31, 2022: EUR 0 thousand). These are attributable to intragroup refinancing. No deferred income tax assets were recognized on the tax interest carry forwards, as they are not expected to be realized in the foreseeable future.

Tax liabilities may arise in connection with investments in subsidiaries and joint ventures. However, these tax liabilities were not recognized in the 2023 fiscal year, as the Group determines the dividend policy of the subsidiaries and can veto dividend payments at joint ventures. The Group can therefore control the reversal of temporary differences in connection with investments in subsidiaries and joint ventures. The Management Board assumes that there will be no reversals in the foreseeable future.