4.6 Income taxes

Income tax

As in the previous year, no current income taxes were incurred in the financial year 2022/23.

In 2022/23, expenses for deferred income taxes of kCHF 896 were significantly lower than in the previous year (kCHF 3 268). The lower valuation gains on investment properties essentially led to a lower allocation to deferred taxes compared to the previous year. In addition, an allocation in the amount of kCHF 804 was required in the previous year for deferred taxes on temporary differences in connection with investments in subsidiaries.

The following table provides a reconciliation of income taxes at the reference tax rate to the income tax reported in the income statement:

Income tax reconciliation

Estimates are necessary for the determination of current as well as deferred taxes. These assumptions relate to the following:

Current tax

The Züblin Group is subject to taxation in Switzerland as well as in the countries were its subsidiaries operate. The determination of the provision for current taxes in these jurisdictions requires significant judgment by Group Management, as the final tax position of many transactions and calculations is unclear.

Deferred tax

Capital gains tax is included in the calculation of deferred taxes on investment properties in Switzerland. These taxes are dependent upon the holding period of the assets, which is determined as follows: for properties that are held for sale, the actual holding period plus one year has been used. For all other properties, either a period of fifteen years, or the actual holding period plus one year if greater than fifteen years, has been assumed. Assumptions are also necessary for deferred tax assets from tax loss carry-forwards. These losses are only capitalized when the use of the losses in the future is probable. The determination as to whether such losses can be offset in the future is based on estimates of the future cash flows deriving from the property, together with estimates by Group Management on the likelihood of utilization of these loss carry-forwards in future periods. Based upon these factors, a probability is assigned to each potential asset and subsequently valued and recorded.