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12 Income taxes

	2011-2012	2010-2011
Consolidated income statement
Current income tax	3 122	10 666
Current income tax charge	3 170	10 900
Adjustments in respect of current income tax of previous periods	-48	-233
Deferred income tax	418	233
Relating to origination and reversal of temporary differences	-47	65
Relating to reduction in tax rates	465	168
Income tax expense reported in consolidated income statement	3 541	10 900
Consolidated statement of changes in equity
Current income tax	-	-
Deferred income tax	-	-
Income tax expense / benefit reported in equity	-	-
Reconciliation of income tax expense applicable to result before tax at the statutory income tax rate to income tax expense at the group’s effective income tax rate
Result before tax	58 458	122 999
Taxes based on local statutory income tax rate	7 532	47 430
Higher (lower) income tax rates of other countries	-357	-1 608
Adjustments in respect of current income tax of previous periods	275	425
Expenses non-deductible for tax purposes	33	9 999
Tax exempt profits	-	-58 486
Non-deductible amortization of goodwill	-	139
Impact of special tax status	-	-
Non-taxable dividends from investments in non-group companies	-	263
Non-recorded deferred income tax assets	65	-
Other	-4 096	9 103
Taxes at effective income tax rate	3 453	10 900
Effective income tax rate	5.9%	5.9%
Deferred income tax relates to the following:
Deferred income tax liabilities
Accelerated depreciation for tax purposes	216	4 646
Remeasurement of financial instruments to fair value	-	90
Deferred taxation on sales of property, plant and equipment	117	1 113
Other	153	4 434
Gross deferred income tax liabilities	486	10 284
Deferred income tax assets
Remeasurement of financial instruments to fair value	-	623
Post-employment benefits	-	-
Tax losses carried forward	2 926	2 532
Other	-	536
Gross deferred income tax assets	2 926	3 691
Net deferred income tax liabilities	486	10 284
Net deferred income tax assets	2 926	3 691

The Gimv group's primary activity consists of taking shareholdings and then reselling them later with a capital gain. This gain is totally or almost totally tax-exempt in the countries in which we are established. Gimv NV has extensive tax loss carryforwards and finally taxed income from the past. With the introduction of notional interest deduction an additional buffer of notional interest deduction is also created every year, which can be carried forward for seven years.
Gimv does not record latent taxation on deductible temporary differences and on tax loss carryforwards. This is because, in the group’s specific tax situation, the likelihood that these can be applied in the near future is considered low. The deferred tax assets and liabilities that are recorded derive exclusively from the majority shareholdings that Gimv is required to consolidate.

The tax expense according to the statutory consolidation amounts to EUR 3 541 and derives for EUR 1 583 from the majority shareholdings that Gimv is required to include in this consolidation. The Gimv group’s risk is limited to the amount of the investment in these majority shareholdings. The Gimv group bears no liability whatsoever for the tax liabilities of these majority shareholdings.

The tax expense in the limited consolidation is EUR 1 958. As an investment company, Gimv NV is mixed VAT liable, and therefore has non-tax deductible VAT in an amount of EUR 1 282. There are also certain companies in the group which pay corporation tax.
 

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