Universal Registration Document Fiscal 2025

ACCOUNTING POLICIES

Income tax expense

Income tax expense for the fiscal year includes current taxes and deferred taxes. It includes the tax on corporate value added (cotisation sur la valeur ajoutée des entreprises (CVAE) ), which applies to French subsidiaries, as the Group considers that it meets the definition of a tax on income as per IAS 12 “Income Taxes”.

Tax credits that do not affect taxable profit and are always refunded by the tax authorities if they have not been deducted from corporate income tax are recognized as subsidies and therefore deducted from the expenses to which they relate.

Uncertain income tax positions are estimated in accordance with IFRIC 23 “Uncertainty over Income Tax Treatments”. A liability is recognized when a tax risk related to the Group's positions is considered to be probable and is measured using the method reflecting the Group's best estimate of the amount it expects to pay to the tax authority (most likely amount or probability-weighted average of the possible outcomes). Uncertain tax position balances are presented as current or deferred tax assets or liabilities in income tax payable.

Deferred tax liabilities

Deferred taxes are recognized on temporary differences between the carrying amount of an asset or liability and its tax base (except in specific cases provided for by IAS 12), and on tax loss carry-forwards, using the tax rate that is expected to apply in the fiscal year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that are enacted or substantially enacted at the fiscal year end.

Taxes on items recognized directly in shareholders’ equity or in other comprehensive income are recognized in shareholders’ equity or in other comprehensive income, respectively, and not in the income statement (see note 11).

Deferred tax assets on temporary differences and tax loss carry-forwards are only recognized if their recoverability is considered probable, considering existing temporary differences giving rise to deferred tax liabilities expected to reverse and taxable profits that will be available in the foreseeable future. Against which the temporary difference can be utilized. When assessing the probability of taxable profit being available in the foreseeable future, account is taken, primarily, of prior years’ results, forecasted future results based on a business plan performed at the level of each taxable entity, non-recurring items unlikely to occur in the future and the tax strategy.

Deferred tax assets and liabilities are not discounted. They are offset if there is a legally enforceable right to set off current tax assets and liabilities and the deferred taxes relate to the same taxable entity and tax authority.