(10) Deferred Taxes

Deferred tax assets and liabilities on hand are shown below. In addition to changes in the current year, these also include deferred taxes to be recorded in the context of the initial consolidation of acquired companies, as well as tax effects from changes in equity recognised directly in equity.

Valuation allowances are made to the carrying amount of deferred tax assets if the realisation of the expected gains from deferred taxes is not sufficiently probable. The estimate made for this purpose may be subject to changes in the course of time, which may lead to a reversal of valuation allowances in subsequent periods. The valuation allowance in the amount of 160 thousand euros (prior year: 241 thousand euros) relates to deferred tax assets from unused tax losses.

The applicable tax rates of the respective company in the year of the reversal are stated for the accrual/deferral of deferred taxes in Germany and in other countries.

The unused tax losses as at 31 December 2008 on which deferred tax assets have been based, concern domestic and foreign subsidiaries. Domestic unused tax losses include unused corporation tax losses of 1,338 thousand euros (prior year: 3,494 thousand euros) as well as trade unused tax losses of 5,390 thousand euros (prior year: 9,793 thousand euros). Some 10,646 thousand euros (prior year: 13,016 thousand euros) are attributable to losses of foreign subsidiaries.

Domestic unused tax losses are considered unlimited in accordance with the current fiscal provisions. The limited use of the loss offset options (minimum taxation) under German tax law has been taken into account in the assessment of the impairment of deferred tax assets on unused tax losses. Unused tax losses abroad expire in part after five years.

Deferred taxes amounting to 1,535 thousand euros (prior year: 1,135 thousand euros) on the assets side on unused tax losses of 6,275 thousand euros (prior year: 4,648 thousand euros) were not capitalised, as the tax claims are not expected to be realised in the near future.

As of 31 December 2008, as in the prior year, no deferred tax liabilities were recognised for taxes on non-transferred earnings of subsidiaries of Bechtle, either because these earnings are not taxable or because they are to be reinvested for an indefinite term.

Temporary differences in connection with interests in subsidiaries for which no tax liabilities were recognised amounted to a total of 5,558 thousand euros (prior year: 2,011 thousand euros).