XML 43 R25.htm IDEA: XBRL DOCUMENT
v3.21.1

DEFERRED INCOME TAX | 12 Months Ended
--- | ---
Dec. 31, 2020
Deferred income tax [Abstract] |
DEFERRED INCOME TAX | INCOME TAX EXPENSE Income tax expense for each of the years presented is as follows:
|  | Year ended December 31,
|  | 2020 |  | 2019 |  | 2018
Current tax |  |  |  |  |  |
Current tax |  | (338,408) |  |  | (256,460) |  |  | (588,773) |
Effect of changes in tax law (1) |  | — |  |  | 4,178 |  |  | (28,596) |
Deferred tax (Note 19) |  |  |  |  |  |
Deferred tax |  | 39,895 |  |  | 38,785 |  |  | 232,485 |
Effect of changes in tax law (1) |  | — |  |  | 16,979 |  |  | — |
Recovery of income tax (2) |  | 7,025 |  |  | — |  |  | 15,449 |
Income tax expense |  | (291,488) |  |  | (196,519) |  |  | (369,435) |
(1) For 2019, it includes mainly the application of the new tax law in Argentina that enables the tax inflation adjustment. The reduction of the tax rate in Argentina enacted in 2017 was modified in 2019, setting the corporate income tax rate to 30% for the year 2020 and to 25% from the year 2021 going forward. For 2018, it includes mainly the option exercised by the Company of the asset revaluation for tax purpose in Argentina, for which an amount of $28.6 million was included. (2) It includes the recovery of tax credits in Ternium Brasil Ltda. Income tax expense for the years ended December 31, 2020, 2019 and 2018 differed from the amount computed by applying the statutory income tax rate in force in each country in which the company operates to pre-tax income as a result of the following:
|  | Year ended December 31,
|  | 2020 |  | 2019 |  | 2018
Income before income tax |  | 1,159,359 |  |  | 826,564 |  |  | 2,031,567 |
Income tax expense at statutory tax rate |  | (350,896) |  |  | (247,592) |  |  | (604,493) |
Non taxable income |  | 118,540 |  |  | 71,101 |  |  | 102,870 |
Non deductible expenses |  | — |  |  | (476) |  |  | (16,201) |
Effect of currency translation on tax base (1) |  | (66,157) |  |  | 33,133 |  |  | 161,536 |
Increase of unrecognized tax losses carried-forward |  | — |  |  | (73,842) |  |  | — |
Recovery of income tax |  | 7,025 |  |  | — |  |  | 15,449 |
Effect of changes in tax law |  | — |  |  | 21,157 |  |  | (28,596) |
Income tax expense |  | (291,488) |  |  | (196,519) |  |  | (369,435) |
(1) Ternium applies the liability method to recognize deferred income tax on temporary differences between the tax bases of assets and their carrying amounts in the financial statements. By application of this method, Ternium recognizes gains and losses on deferred income tax due to the effect of the change in the value on the tax basis in subsidiaries, which have a functional currency different to their local currency, mainly Mexico and Argentina. Tax rates used to perform the reconciliation between tax expense (income) and accounting profit are those in effect at each relevant date or period in each applicable jurisdiction. DEFERRED INCOME TAX Deferred income taxes are calculated in full on temporary differences under the liability method using the tax rate of the applicable country. Changes in deferred income tax are as follows:
|  | As of December 31,
|  | 2020 |  | 2019
At the beginning of the year |  | (239,740) |  |  | (340,207) |
Translation differences |  | (36) |  |  | 25,166 |
Effect of changes in tax law (note 10) |  | — |  |  | 16,979 |
Credits directly to other comprehensive income |  | 12,100 |  |  | 19,537 |
Deferred tax credit (note 10) |  | 39,894 |  |  | 38,785 |
At the end of the year |  | (187,782) |  |  | (239,740) |
19. DEFERRED INCOME TAX (continued) The changes in deferred tax assets and liabilities (prior to offsetting the balances within the same tax jurisdiction) during the year are as follows:
Deferred tax liabilities |  | PP&E |  | Inventories |  | Intangible assets |  | Other |  | Total at December 31, 2020
At the beginning of the year |  | (437,376) |  |  | (63,460) |  |  | (17,109) |  |  | (1,189) |  |  | (519,134) |
Translation differences |  | 46 |  |  | — |  |  | — |  |  | — |  |  | 46 |
Income statement credit (charge) |  | 11,190 |  |  | 33,273 |  |  | (3,601) |  |  | (832) |  |  | 40,030 |
At the end of the year |  | (426,140) |  |  | (30,187) |  |  | (20,710) |  |  | (2,021) |  |  | (479,058) |
Deferred tax assets |  | Provisions |  | Trade receivables |  | Tax losses (1) |  | Other |  | Total at December 31, 2020
At the beginning of the year |  | 45,654 |  |  | 10,200 |  |  | 42,766 |  |  | 180,774 |  |  | 279,394 |
Translation differences |  | — |  |  | — |  |  | — |  |  | (82) |  |  | (82) |
Credits directly to other comprehensive income |  | — |  |  | — |  |  | — |  |  | 12,100 |  |  | 12,100 |
Income statement credit (charge) |  | 6,688 |  |  | (1,014) |  |  | (11,682) |  |  | 5,873 |  |  | (136) |
At the end of the year |  | 52,342 |  |  | 9,186 |  |  | 31,084 |  |  | 198,665 |  |  | 291,276 |
(1) As of December 31, 2020, the recognized deferred tax assets on tax losses amount to $31,084 and there are net unrecognized deferred tax assets of $0.2 billion and unrecognized tax losses amounting to $1.0 billion. These two last effects are connected to the acquisition of Ternium Brasil Ltda.
Deferred tax liabilities |  | PP&E |  | Inventories |  | Intangible assets |  | Other |  | Total at December 31, 2019
At the beginning of the year |  | (522,455) |  |  | (41,316) |  |  | (15,926) |  |  | (1,088) |  |  | (580,785) |
Translation differences |  | 27,077 |  |  | 2,604 |  |  | 316 |  |  | — |  |  | 29,997 |
Income statement credit (charge) |  | 58,002 |  |  | (24,748) |  |  | (1,499) |  |  | (101) |  |  | 31,654 |
At the end of the year |  | (437,376) |  |  | (63,460) |  |  | (17,109) |  |  | (1,189) |  |  | (519,134) |
Deferred tax assets |  | Provisions |  | Trade receivables |  | Tax losses (2) |  | Other |  | Total at December 31, 2019
At the beginning of the year |  | 72,947 |  |  | 11,265 |  |  | 33,382 |  |  | 122,984 |  |  | 240,578 |
Translation differences |  | (572) |  |  | (539) |  |  | — |  |  | (3,720) |  |  | (4,831) |
Credits directly to other comprehensive income |  | — |  |  | — |  |  | — |  |  | 19,537 |  |  | 19,537 |
Effect of changes in tax law |  | — |  |  | — |  |  | — |  |  | 16,979 |  |  | 16,979 |
Income statement credit (charge) |  | (26,721) |  |  | (526) |  |  | 9,384 |  |  | 24,994 |  |  | 7,131 |
At the end of the year |  | 45,654 |  |  | 10,200 |  |  | 42,766 |  |  | 180,774 |  |  | 279,394 |
(2) As of December 31, 2019, the recognized deferred tax assets on tax losses amount to $42,766 and there are net unrecognized deferred tax assets of $0.4 billion and unrecognized tax losses amounting to $1.4 billion. These two last effects are connected to the acquisition of Ternium Brasil Ltda. Deferred tax assets and liabilities are offset when the entity a) has a legally enforceable right to set off the recognized amounts; and b) intends to settle the tax on a net basis or to realize the asset and settle the liability simultaneously. 19. DEFERRED INCOME TAX (continued) The amounts shown in the statement of financial position (prior to offsetting the balances within the same tax jurisdiction) include the following:
|  |  |  |  |  | As of December 31,
|  |  |  |  |  | 2020 |  | 2019
Deferred tax assets to be recovered after more than 12 months |  |  |  |  |  | 200,639 |  |  | 203,607 |
Deferred tax assets to be recovered within 12 months |  |  |  |  |  | 90,637 |  |  | 75,787 |
Deferred tax liabilities to be settled after more than 12 months |  |  |  |  |  | (446,891) |  |  | (454,763) |
Deferred tax liabilities to be settled within 12 months |  |  |  |  |  | (32,167) |  |  | (64,371) |
|  |  |  |  |  | (187,782) |  |  | (239,740) |

X
- Definition The entire disclosure for income taxes. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Name IAS -Number 12 -IssueDate 2020-01-01 -Section Disclosure -URI http://eifrs.ifrs.org/eifrs/xifrs-link?type=IAS&num=12&code=ifrs-tx-2020-en-r&doctype=Standard&dita_xref=IAS12_g79-88_TI -URIDate 2020-01-01 + Details
Name: | ifrs-full_DisclosureOfIncomeTaxExplanatory
Namespace Prefix: | ifrs-full_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Deferred income tax [Abstract] + References No definition available. + Details
Name: | tx_DeferredincometaxAbstract
Namespace Prefix: | tx_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration