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Note 21 - Deferred Income Tax | 12 Months Ended
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Dec. 31, 2020
Disclosure of temporary difference, unused tax losses and unused tax credits [abstract] |
Note 21 - Deferred Income Tax | 21 Deferred income tax Deferred income taxes are calculated in full on temporary differences under the liability method using the tax rate of each country. The evolution of deferred tax assets and liabilities during the year are as follows: Deferred tax liabilities
(all amounts in thousands of U.S. dollars) |  | Fixed assets |  |  | Inventories |  |  | Intangible and Other |  |  | Total |
At the beginning of the year |  |  | 651,339 |  |  |  | 19,396 |  |  |  | 118,062 |  |  |  | 788,797 |
Translation differences |  |  | 1,644 |  |  |  | - |  |  |  | 253 |  |  |  | 1,897 |
Increase due to business combinations |  |  | 89,306 |  |  |  | - |  |  |  | 43,397 |  |  |  | 132,703 |
Charged to other comprehensive income |  |  | - |  |  |  | - |  |  |  | (1,194 | ) |  |  | (1,194 | )
Income statement (credit) |  |  | (39,874 | ) |  |  | (4,141 | ) |  |  | (34,725 | ) |  |  | (78,740 | )
At December 31, 2020 |  |  | 702,415 |  |  |  | 15,255 |  |  |  | 125,793 |  |  |  | 843,463 |
(all amounts in thousands of U.S. dollars) |  | Fixed assets |  |  | Inventories |  |  | Intangible and Other |  |  | Total |
At the beginning of the year |  |  | 710,995 |  |  |  | 25,048 |  |  |  | 46,532 |  |  |  | 782,575 |
Translation differences |  |  | (347 | ) |  |  | - |  |  |  | (4 | ) |  |  | (351 | )
Increase due to business combinations |  |  | 5,621 |  |  |  | - |  |  |  | 11,209 |  |  |  | 16,830 |
Charged to other comprehensive income |  |  | - |  |  |  | - |  |  |  | 423 |  |  |  | 423 |
Income statement charge / (credit) |  |  | (64,930 | ) |  |  | (5,652 | ) |  |  | 59,902 |  |  |  | (10,680 | )
At December 31, 2019 |  |  | 651,339 |  |  |  | 19,396 |  |  |  | 118,062 |  |  |  | 788,797 |
Deferred tax assets
(all amounts in thousands of U.S. dollars) |  | Provisions and allowances |  |  | Inventories |  |  | Tax losses |  |  | Other |  |  | Total |
At the beginning of the year |  |  | (19,653 | ) |  |  | (93,404 | ) |  |  | (382,832 | ) |  |  | (181,606 | ) |  |  | (677,495 | )
Translation differences |  |  | 1,804 |  |  |  | 513 |  |  |  | 1,996 |  |  |  | 644 |  |  |  | 4,957 |
Increase due to business combinations |  |  | (7,452 | ) |  |  | (24,580 | ) |  |  | (33,598 | ) |  |  | (34,974 | ) |  |  | (100,604 | )
Charged to other comprehensive income |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (1,952 | ) |  |  | (1,952 | )
Income statement charge / (credit) |  |  | 4,093 |  |  |  | 31,534 |  |  |  | (65,715 | ) |  |  | 10,930 |  |  |  | (19,158 | )
At December 31, 2020 |  |  | (21,208 | ) |  |  | (85,937 | ) |  |  | (480,149 | ) |  |  | (206,958 | ) |  |  | (794,252 | )
(all amounts in thousands of U.S. dollars) |  | Provisions and allowances |  |  | Inventories |  |  | Tax losses |  |  | Other |  |  | Total |
At the beginning of the year |  |  | (16,116 | ) |  |  | (86,585 | ) |  |  | (396,257 | ) |  |  | (86,184 | ) |  |  | (585,142 | )
Translation differences |  |  | 362 |  |  |  | 306 |  |  |  | 497 |  |  |  | 286 |  |  |  | 1,451 |
Increase due to business combinations |  |  | (1,160 | ) |  |  | (1,413 | ) |  |  | (1,172 | ) |  |  | (2,238 | ) |  |  | (5,983 | )
Charged to other comprehensive income |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (1,261 | ) |  |  | (1,261 | )
Income statement charge / (credit) |  |  | (2,739 | ) |  |  | (5,712 | ) |  |  | 14,100 |  |  |  | (92,209 | ) |  |  | (86,560 | )
At December 31, 2019 |  |  | (19,653 | ) |  |  | (93,404 | ) |  |  | (382,832 | ) |  |  | (181,606 | ) |  |  | (677,495 | )
In 2019 the effect of the adoption of IFRS 16 has been recognized as “Other” both for deferred tax assets and liabilities. Deferred tax assets related to taxable losses of Tenaris subsidiaries are recognized to the extent it is considered probable that future taxable profits will be available against which such losses can be utilized in the foreseeable future. This amount includes $438.8 million related to U.S. subsidiaries mainly due to the recognition of accelera ted fiscal depreciations, as well as the amounts related to the acquisition of IPSCO. The U.S. subsidiaries have incurred in fiscal losses in the past years. The remaining balance mainly corresponds to Tenaris’s Colombian, Japanese, Canadian and Saudi Arabian subsidiar ies. These subsidiaries have incurred in fiscal losses in the past one or two years. Tenaris has concluded that these deferred tax assets will be recoverable based on t he business plans and budgets. The expiration dates of the recognized tax losses in less than 1 year, between 2 and 5 years and in more than 5 years is approximately 0%, 1.7% and 98.3% respectively. As of December 31, 20 20, the net unrecognized deferred tax assets amount ed to $173.7 million. The expiration dates of the unrecognized tax losses less than 1 year, between 2 and 5 years and more than 5 years is approximately 4.6%, 17.1% and 78.3% respectively. The estimated recovery analysis of deferred tax assets and deferred tax liabilities is as follows:
(all amounts in thousands of U.S. dollars) |  |  | Year ended December 31, |
|  | 2020 |  |  | 2019 |
Deferred tax assets to be recovered after 12 months |  |  | (640,603 | ) |  |  | (538,274 | )
Deferred tax liabilities to be settled after 12 months |  |  | 840,892 |  |  |  | 766,852 |
Deferred income tax assets and liabilities are offset when (1) there is a legally enforceable right to set-off current tax assets against current tax liabilities and (2) when the deferred income taxes relate to the same fiscal authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis. The following amounts, determined after appropriate set-off, are shown in the C onsolidated S tatement of F inancial P osition:
(all amounts in thousands of U.S. dollars) |  |  | Year ended December 31, |
|  | 2020 |  |  | 2019 |
Deferred tax assets |  |  | (205,590 | ) |  |  | (225,680 | )
Deferred tax liabilities |  |  | 254,801 |  |  |  | 336,982 |
|  |  | 49,211 |  |  |  | 111,302 |
The movement i n the net deferred income tax liability account is as follows:
|  |  | Year ended December 31, |
|  | 2020 |  |  | 2019 |
At the beginning of the year |  |  | 111,302 |  |  |  | 197,433 |
Translation differences |  |  | 6,854 |  |  |  | 1,100 |
Increase due to business combinations |  |  | 32,099 |  |  |  | 10,847 |
Charged to other comprehensive income |  |  | (3,146 | ) |  |  | (838 | )
Income statement (credit) |  |  | (97,898 | ) |  |  | (97,240 | )
At the end of the year |  |  | 49,211 |  |  |  | 111,302 |

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