Annual report 2004 (PDF, 4141 kB) - Unicredit Bank

The tax on the operating profit differs from the theoretical amount that would arise using the
basic tax rate of the Czech Republic as follows:
Group 31 December 2004 31 December 2003
CZK m
CZK m
Profit before tax 125 313
Prima facie tax calculated at a tax rate of 28% (31%) 35 97
Income not assessable for tax purposes -132 -27
Expenses not deductible for tax purposes 164 38
10% investment relief -10 0
Deductible gifts -1 0
Tax effect of consolidation adjustments including tax shield 128 36
Additional tax charge for the year 2003 (2002) 1 2
Additional income tax assesment 21 0
Movement on deferred tax assets -41 0
The effective tax rate for the Group is 46.4% (31 December 2003: 46.6%).
Deferred income taxes
58 146
31 December 2004 31 December 2003
CZK m
CZK m
Deferred income tax assets
Tax non-deductible provisions for loans 44 39
Unused tax losses 0 8
Other timing differences 7 5
51 52
Deferred income tax liabilities
Differences between carrying amount and and tax base
of fixed assets -10 -11
Net deferred income tax asset 41 41
Deferred income taxes are calculated on all temporary differences under the liability method
using an effective tax rate of 26% and 24% for the temporary differences expected to be
realised in 2005 and the following years respectively (2003: 28%, 26% and 24%).
The net deferred tax asset was not recognized in 2003. In 2004, the Bank recognised net
deferred tax asset of MCZK 41 as management believes that future taxable profit will be
available against which the temporary differences can be utilised (Note 1(p)).
81