Mercedes 2008 Annual Report Download - page 168

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In 2008 and 2006, the Group recorded additional valuation
allowances on deferred tax assets of foreign subsidiaries.
In 2007, tax expenses were recorded as a result of a valuation
allowance on deferred tax assets related to the deconsolidated
Chrysler activities. These deferred tax assets continue to be allo-
cated to the Daimler Group, but as a result of the Chrysler
transaction, the conditions for using these deferred taxes have
changed. Furthermore, as a result of the Chrysler transaction,
a valuation allowance on foreign tax credits was required in 2007.
In 2008, the Group reversed a part of this valuation allowance
due to the conversion of those assets in taxable losses attribut-
able to the Daimler Group. The resulting tax expenses and
benefits are included in the line change of valuation allowance on
deferred tax assets.
Tax-free income and non-deductible expenses includes all other
effects at foreign and German companies due to tax-free income
and non-deductible expenses, for instance tax-free gains inclu-
ded in net periodic pension costs at the German companies and
tax-free results of our equity method investments. Moreover,
the line also includes the following effects:
In 2008 and 2007, Daimler realized a largely tax-free gain due
to the transfer of interest in EADS. Furthermore, in 2007 and 2006,
largely tax-free gains were included from financial transactions
to hedge price risks of EADS shares. The calculated expected
income taxes on the tax-free gains were reversed in the line
tax-free income and non-deductible expenses with an amount of
€34 million (2007: €582 million; 2006: €171 million).
In respect of each type of temporary difference and in respect of
each type of unutilized tax losses and unutilized tax credits,
the deferred tax assets and liabilities before offset are summa-
rized as follows:
Deferred tax assets and deferred tax liabilities were offset if the
deferred tax assets and liabilities relate to income taxes levied by
the same taxation authority and if there is the right to set off of
current tax assets against current tax liabilities. In the balance
sheet, the deferred tax assets and liabilities are not split into
current and non-current.
At December 31,
2007
2008
120
559
953
701
2,357
89
3,622
3,703
610
1,729
1,351
552
49
16,395
(3,510)
12,885
(1,406)
(88)
(1,239)
(3,775)
(140)
(1,403)
(158)
(522)
(2,640)
(193)
(48)
(170)
(11,782)
1,103
191
782
837
617
2,142
578
3,067
3,150
530
1,735
1,204
612
174
15,619
(2,915)
12,704
(1,190)
(72)
(873)
(3,686)
(147)
(1,182)
(164)
(483)
(2,434)
(406)
(45)
(813)
(11,495)
1,209
Intangible assets
Property, plant and equipment
Equipment on operating leases
Inventories
Investments accounted for using the equity method
Receivables from financial services
Other financial assets
Net operating loss and tax credit carry forwards
Provisions for pensions and similar obligations
Other provisions
Liabilities
Deferred income
Other
Valuation allowances
Deferred tax assets
Development cost
Other intangible assets
Property, plant and equipment
Equipment on operating leases
Inventories
Receivables from financial services
Other financial assets
Other assets
Provisions for pensions and similar obligations
Other provisions
Taxes on undistributed earnings of
non-German subsidiaries
Other
Deferred tax liabilities
Deferred tax assets, net
in millions of €