6.15 Deferred tax assets and liabilities

The net amount of the deferred tax assets and liabilities related to temporary differences between the carrying amounts for tax purposes and for reporting purposes of items in the statement of financial position, together with recognised tax-loss carry-forwards, can be broken down as follows:

The movement in the statement of financial position of the deferred tax assets and liabilities in 2023 breaks down as follows:

x € 1,000

The movement in the statement of financial position of the deferred tax assets and liabilities in 2022 breaks down as follows:

x € 1,000

6.15a Measurement of deferred tax assets

At year-end 2023, the recognised loss carry-forward stood at € 13.3 million (2022: € 20.9 million). The recognised loss carry-forwards relate almost entirely to the Dutch tax group Heijmans N.V. The utilisation of tax loss carry-forwards changed on 1 January 2022. Under the new loss relief rules, from the financial year 2022 it has only been possible to utilise 50% of profits above € 1 million against past losses. On the other hand, from the financial year 2022 it is possible under the new loss relief rules to carry forward all losses against future profits indefinitely.

A deferred tax asset is recognised to the extent that it is probable, based on forecasts, that sufficient future taxable profits will be available to be utilised for the realisation of the deferred asset. The majority of activities are performing as planned. The forecasts are based on the order book, the 2023 business plan, and the long-term forecast, which are also the basis for the measurement of the recoverable amount of goodwill (impairment tests). The long-term forecast is based on the assumption that the average EBIT margin of the Dutch tax group with grow slightly. A factor inherent in the measurement of the deferred tax assets is that the utilisation of losses depends on the realisation of the 2024 business plan and the long-term forecasts, which are the Group’s best estimates. Based on the projected results for 2024 through 2026 and the current tax rate of 25.8%, there will be sufficient taxable profits over the next few years to enable the Group to realise the tax asset recognised as at 31 December 2023.

The netting of deferred tax assets with deferred tax liabilities is allowed as long as there is a legally enforceable right to set off current tax assets against current tax liabilities, together with an intention to do so, and the deferred taxes relate to income taxes levied by the same tax authority for the same entity or for the same tax unit. The deferred tax asset has not been netted with the deferred tax liability because they are not attributable to the same tax unit.

The movement in the deferred tax assets was as follows:

x € 1,000

6.15b Measurement of deferred tax liabilities

For determining the amount of the deferred tax liabilities, the value for tax purposes of the construction work in progress in the Netherlands (including residential building projects) is treated as being equal to the value under IFRS.

Deferred tax assets or liabilities are recognised for any temporary differences originating at subsidiaries, joint operations or joint ventures. In 2023, Heijmans completed the acquisition of Van Wanrooij. The application of IFRS 3 resulted in the fair value adjustment of intangible assets (€ 6 million) and inventories and strategic land holdings (€ 123 million at Heijmans and € 19 million at joint ventures, taking the total to € 142 million). This positive difference of € 148.4 million from the carrying amount of the acquired assets results in an increase in the tax base of those assets. The future reversal of this difference gives rise to a deferred tax liability of € 38 million, with € 33 million of this capitalised at Heijmans and € 5 million capitalised at joint ventures on the opening balance sheet in September 2023.

The majority of the deferred tax liabilities have a term of more than one year.

Tax losses not recognised in the statement of financial position

At year-end 2023, the tax losses not recognised in the statement of financial position amounted to € 44.8 million (2023: € 43.4 million). These are primarily related to Dynniq Energy BV, which was acquired in 2022 (2023: € 1.7 million) and three foreign subsidiaries (in Belgium and Germany) that perform no operational activities (2023: € 42.6 million). These unrecognised tax losses can be carried forward indefinitely and do not expire.