The changes in deferred tax assets and liabilities are as follows.
(in millions of euros) | Net balance as at 1 January 2018 | recognised in income statement | recognised in other comprehensive income | other changes | Net positions as at 31 December 2018 | Deferred tax assets | Deferred tax liabilities | |
Property, plant and equipment | 83 | -12 | - | - | 71 | 93 | 22 | |
Intangible assets | -18 | - | - | - | -18 | - | 18 | |
Non-current financial assets | -8 | 2 | - | 3 | -3 | 4 | 7 | |
Receivables | 2 | -2 | - | - | - | - | - | |
Provisions | -1 | 3 | - | - | 2 | 2 | - | |
Deferred credits | 58 | -15 | - | - | 43 | 43 | - | |
Loans and other financial liabilities | 2 | -2 | - | - | - | - | - | |
Other items | -1 | 4 | - | - | 3 | 4 | 1 | |
Loss set-off | 84 | -34 | 50 | 50 | - | |||
Deferred tax assets (liabilities) | 201 | -56 | - | 3 | 148 | 196 | 48 | |
(in millions of euros) | Net balance as at 1 January 2019 | Adjustments due to application of IFRS 16 | recognised in income statement | recognised in other comprehensive income | Other changes | Net positions as at 31 December 2019 | Deferred tax assets | Deferred tax liabilities |
Property, plant and equipment | 71 | 11 | - | 2 | 84 | 107 | 23 | |
Intangible assets | -18 | -1 | - | - | -19 | - | 19 | |
Right-of-use assets | -436 | -8 | 0 | 0 | -444 | -444 | - | |
Non-current financial assets | -3 | - | - | - | -3 | 4 | 7 | |
Receivables | - | - | - | - | - | - | - | |
Provisions | 2 | 1 | - | - | 3 | 3 | - | |
Deferred credits | 43 | -5 | - | - | 38 | 43 | 5 | |
Loans and other financial liabilities | - | - | - | - | - | - | - | |
Lease liabilities | 445 | 5 | 0 | 450 | 450 | - | ||
Other items | 3 | - | - | - | 3 | 3 | - | |
Loss set-off | 50 | -14 | 0 | 36 | 36 | - | ||
Deferred tax assets (liabilities) | 148 | 9 | -11 | - | 2 | 148 | 202 | 54 |
Net operating losses that are categorised as tax losses under Dutch tax law and that arise in the Dutch subsidiaries can in general be offset against future profits recorded in the six years after the year in which the loss was incurred, and can be offset against the profit recorded in the year preceding the year of the loss. There are similar rules for the positions in foreign enterprises.
As at 31 December 2019, the Group had deferred tax assets of €144 million for the tax group in the Netherlands (31 December 2018: €156 million). These deferred tax assets are partly covered by deferred tax liabilities that lead to taxable profits in the reference period up to and including 2026 and forecast profits up to and including 2026, mainly based on the Group Plan 2020-2024. The forecasts are based on the current composition of the Group's activities and take into account the main rail network franchise that started on 1 January 2015. The deferred tax asset relating to loss carry-forwards in the Netherlands was realised in full at the end of 2019.
Following assessment of the deferred tax asset relating to loss carry-forwards in Germany of €39 million gross, it was written down by an amount of €3 million to €36 million.
For the calculation of the deferred tax position of the Dutch entities, the applicable rate of 25% for 2019, 25% for 2020 and 21.7% for subsequent years has been used. For the calculation of the deferred tax position of the entities in the United Kingdom and Germany, respectively, the applicable rates of 17% and 32%, respectively, for 2019 and for subsequent years have been used.
Accounting policies
The deferred tax assets and deferred tax liabilities arise from temporary differences between the carrying amount of assets and liabilities in the financial reporting and their tax base. These are calculated on the basis of the tax rates that are expected to apply when the temporary differences are reversed, using tax rates enacted or substantively enacted as at the reporting date.
Deferred tax assets, including those deriving from tax loss carry-forwards, are measured if it is probable that sufficient tax profits will be available for setting off the losses and if possibilities for offsetting losses can be utilised.
Deferred tax assets and deferred tax liabilities are only netted if there is a formal netting right and the company intends to settle deferred tax positions simultaneously. Deferred tax positions are stated at nominal value.