Financial statements

NOTE 16



TAX AND SOCIAL SECURITY RECEIVABLES AND PAYABLES

The composition of the current tax and social security payables and receivables at 31 December 2017 is as follows:

16.1 Current tax and social security receivables and payables


(Euros) - 2017
Balance at 31/12/2017
Receivable
Balance at 31/12/2017
Payable
Balance at 31/12/2016
Receivable
Balance at 31/12/2016
Payable
Social Security bodies 0 539.660 0 521.773
Caixa Andorrana de la Seguretat Social 0 539.660 0 521.773
Tax Agency 240.134 4.298.958 870.928 2.116.201
Indirect taxes 0 283.708 0 246.445
Corporate income tax 0 3.073.124 0 1.645.259
Personal income tax withholdings pending payment 0 27.480 0 32.676
Non-resident income tax pending payment 0 179.298 0 191.822
Deferred tax assets 239.812 0 867.586 0
Tax and other payables (payments in kind) 735.349 0 0
Others 321 0 3.342 0

The corporate income tax payable is shown at its net amount, including the advance payment for 2017 made during the year in the amount of 1,338,864.22 euros.

16.2 Reconciliation between accounting profit and corporate income tax expense

The reconciliation between the Company’s accounting profit and profit for the purposes of corporate income tax at 31 December 2017 is as follows

(Amounts in euros) Balance at 31/12/17 Balance at 31/12/16
Income before taxes 55.991.192 40.456.005
+ Permanent differences 292.882 -190.289
+ Timing differences -6.277.743 1.367.849
Taxable income 50.006.330 41.633.565
x tax rate 10% 5.000.633 4.163.357
Gross payable 5.000.633 4.163.357
- Deductions and credits -1.138.681 -1.485.628
Total estimated tax payable for 2017 3.861.952 2.677.728
Differences for deferred tax assets and liabilities 627.774 -136.785
Other adjustments (*) 550.036 135.067
Accrued tax for the year 5.039.762 2.676.011
Corrections for previous years charged to profit for the period 0 22.099
Corporate income tax expense 5.039.762 2.698.110

(*) The other adjustments correspond to the application of the 5% tax credit on investments retired prior to the five-year period established in the Corporate Income Tax Law.

16.3 Years open to review for corporate income tax

Under Andorran tax law, tax liabilities cannot be considered definitively settled until either the tax returns filed have been inspected by the tax authorities or the statutory three-year limitation period has expired. Therefore, the Company has the last four years open to inspection for corporate income tax and the last three years for all the other taxes that are applicable to it.

The Company’s Directors believe that the settlements of those taxes have been done properly, so, even if differences were to arise in the interpretation of the regulations governing the tax treatment of its operations, such liabilities as could arise would not have a material effect on the accompanying financial statements.