22. Income taxes
Income taxes recognized in the income statements can be detailed as follows:
|
|
Year Ended December 31, |
||||
|---|---|---|---|---|---|---|
(in thousands of $) |
|
2025 |
|
2024 |
|
2023 |
Current year |
|
(351,264) |
|
(53,462) |
|
(9,592) |
Income tax prior years |
|
13,224 |
|
(383) |
|
(2,080) |
Current tax expense |
|
(338,040) |
|
(53,845) |
|
(11,672) |
|
|
|
|
|
|
|
Recognition of deferred tax assets |
|
– |
|
724,700 |
|
– |
Originating and reversal of temporary differences |
|
351,468 |
|
77,005 |
|
21,115 |
Deferred tax benefit |
|
351,468 |
|
801,705 |
|
21,115 |
|
|
|
|
|
|
|
Total income tax benefit |
|
13,428 |
|
747,860 |
|
9,443 |
The difference between the provision for income taxes and the amount that would result from applying the Dutch statutory tax rate to income before provision for income taxes is as follows:
|
|
Year Ended December 31, |
||||||||
|---|---|---|---|---|---|---|---|---|---|---|
(in thousands of $) |
|
2025 |
|
2024 |
|
2023 |
||||
(Profit)/Loss before taxes |
|
(1,278,607) |
|
(85,180) |
|
304,496 |
||||
Income tax (expense)/benefit calculated at the Dutch statutory federal income tax rates |
|
(329,881) |
|
(21,977) |
|
78,560 |
||||
Effect of intercompany asset deal/transaction |
|
– |
|
– |
|
396 |
||||
Effect of expenses not deductible in determining taxable results |
|
(6,188) |
|
(5,383) |
|
(2,674) |
||||
Effect of share-based payment expenses that are not deductible in determining taxable results |
|
(29,673) |
|
(13,151) |
|
(43,040) |
||||
Effect of stock issue expenses that are not taxable in determining taxable results |
|
– |
|
– |
|
18,620 |
||||
Effect of tax credits and incentives1) |
|
291,865 |
|
102,823 |
|
87,123 |
||||
Effect of change of (de)recognition of deferred tax assets on tax losses |
|
(2,500) |
|
187,361 |
|
(2,282) |
||||
Effect of different tax rates in jurisdictions in which the company operates |
|
9,685 |
|
4,169 |
|
(3,509) |
||||
Effect of change of (de)recognition of deferred tax assets |
|
– |
|
535,598 |
|
(124,457) |
||||
Effect of foreign exchange translation |
|
87,070 |
|
(38,307) |
|
– |
||||
Other |
|
(6,950) |
|
(3,273) |
|
706 |
||||
Income tax (expense)/benefit recognized in the consolidated statements of profit or loss |
|
13,428 |
|
747,860 |
|
9,443 |
||||
|
||||||||||
Deferred tax assets are recognized to the extent that it is probable that sufficient taxable profits will be available in the look-forward period. In the fourth quarter of 2024, the Company recognized a consolidated tax benefit for previously unrecognized net deferred tax assets amounting to $725 million, based on the weight of available evidence.
The amount of deferred tax assets and liability by type of temporary difference can be detailed as follows:
|
|
As of December 31, 2025 |
||||
|---|---|---|---|---|---|---|
(in thousands of $) |
|
Assets |
|
Liabilities |
|
Net |
Deferred tax assets/(liabilities) |
|
|
|
|
|
|
Innovation income deduction credit |
|
159,360 |
|
– |
|
159,360 |
Net operating loss carryforwards |
|
138,487 |
|
– |
|
138,487 |
Capitalized R&D expenses |
|
445,550 |
|
– |
|
445,550 |
Intangible assets |
|
94,383 |
|
– |
|
94,383 |
Accruals and allowances |
|
122,654 |
|
– |
|
122,654 |
Share-based payments |
|
99,408 |
|
– |
|
99,408 |
Profit in inventory |
|
225,033 |
|
– |
|
225,033 |
Other tax carryforwards |
|
16,206 |
|
– |
|
16,206 |
Property, plant and equipment |
|
4,130 |
|
(2,121) |
|
2,009 |
Non-current fixed assets |
|
– |
|
(8,683) |
|
(8,683) |
Other |
|
1,944 |
|
(498) |
|
1,446 |
Netting by taxable entity |
|
(11,302) |
|
11,302 |
|
– |
Net deferred tax assets |
|
1,295,853 |
|
– |
|
1,295,853 |
|
|
As of December 31, 2024 |
||||
|---|---|---|---|---|---|---|
(in thousands of $) |
|
Assets |
|
Liabilities |
|
Net |
Deferred tax assets/(liabilities) |
|
|
|
|
|
|
Innovation Income deduction |
|
122,306 |
|
– |
|
122,306 |
Net operating loss carryforwards |
|
177,599 |
|
– |
|
177,599 |
Capitalized R&D expenses |
|
312,420 |
|
– |
|
312,420 |
Intangible assets |
|
100,321 |
|
– |
|
100,321 |
Accruals and allowances |
|
25,037 |
|
– |
|
25,037 |
Share-based payments |
|
71,481 |
|
– |
|
71,481 |
Profit in inventory |
|
110,474 |
|
– |
|
110,474 |
Other tax carryforwards |
|
8,874 |
|
– |
|
8,874 |
Property, plant and equipment |
|
3,392 |
|
(3,012) |
|
380 |
Non-current fixed assets |
|
– |
|
(6,289) |
|
(6,289) |
Other |
|
2,265 |
|
(569) |
|
1,696 |
Netting by taxable entity |
|
(9,870) |
|
9,870 |
|
– |
Net deferred tax assets/(liabilities) |
|
924,299 |
|
– |
|
924,299 |
|
|
As of December 31, 2023 |
||||
|---|---|---|---|---|---|---|
(in thousands of $) |
|
Assets |
|
Liabilities |
|
Net |
Deferred tax assets/(liabilities) |
|
|
|
|
|
|
Accruals and allowances |
|
13,189 |
|
– |
|
13,189 |
Share-based payments |
|
23,310 |
|
– |
|
23,310 |
Profit in inventory |
|
52,026 |
|
– |
|
52,026 |
Other tax carryforwards |
|
6,339 |
|
– |
|
6,339 |
Property, plant and equipment |
|
2,136 |
|
(1,550) |
|
586 |
Non-current fixed assets |
|
– |
|
(5,155) |
|
(5,155) |
Other |
|
1,760 |
|
– |
|
1,760 |
Netting by taxable entity |
|
(1,549) |
|
1,550 |
|
1 |
Net deferred tax assets/(liabilities) |
|
97,211 |
|
(5,155) |
|
92,056 |
The change in net deferred taxes recorded in the consolidated statements of financial position can be detailed as follows:
(in thousands of $) |
|
Deferred tax assets |
|
Deferred tax liabilities |
|---|---|---|---|---|
Balance on January 1, 2025 |
|
924,299 |
|
– |
Recognized in profit or loss |
|
264,021 |
|
– |
Recognized in equity |
|
20,780 |
|
– |
Effects of change in foreign exchange rate |
|
86,753 |
|
– |
Balance on December 31, 2025 |
|
1,295,853 |
|
– |
(in thousands of $) |
|
Deferred tax assets |
|
Deferred tax liabilities |
|---|---|---|---|---|
Balance on January 1, 2024 |
|
97,211 |
|
(5,155) |
Recognized in profit or loss |
|
758,264 |
|
5,155 |
Recognized in equity |
|
30,846 |
|
– |
Effects of change in foreign exchange rate |
|
37,978 |
|
– |
Balance on December 31, 2024 |
|
924,299 |
|
– |
(in thousands of $) |
|
Deferred tax assets |
|
Deferred tax liabilities |
|---|---|---|---|---|
Balance on January 1, 2023 |
|
79,222 |
|
(8,406) |
Recognized in profit or loss |
|
17,685 |
|
3,430 |
Recognized in equity |
|
381 |
|
– |
Effects of change in foreign exchange rate |
|
(77) |
|
(179) |
Balance on December 31, 2023 |
|
97,211 |
|
(5,155) |
The Company also has unrecognized tax losses carried forward in the Netherlands in the amount of $56 million as of December 31, 2025, compared to $46 million on December 31, 2024 and $33 million on December 31, 2023. These losses carried forward do not have an expiration date based upon the applicable enacted tax legislation in the Netherlands.
As of December 31, 2025, the Company has $209 million of undistributed earnings attributable to foreign subsidiaries (compared to $125 million on December 31, 2024 and $128 million on December 31, 2023) for which no provision for deferred tax liabilities have been recognized because the Company has control over the timing of the reversal of the temporary differences and there are no plans of distributions in the foreseeable future.
The Company is subject to the OECD Pillar Two Directive and implementing domestic laws in 2025. The Pillar Two Rules does not have a material impact on our effective tax rate or the recognition of our deferred tax assets.
The Company continues to apply the exception relating to recognizing and disclosing information about deferred tax assets and liabilities related to legislation that is enacted to implement the OECD Pillar Two model rules.