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SEC Filings

20-F
TRIVAGO N.V. filed this Form 20-F on 03/06/2018
Entire Document
 



Reconciliation of German statutory income tax rate to effective income tax rate
The following table summarizes our income (loss) before income taxes allocated to Germany and to other countries:

 
Year ended December 31,
(in thousands)
 
2015

 
2016

 
2017

Germany
 
(50,446
)
 
(32,985
)
 
(20,018
)
Other countries
 
(238
)
 
(11,736
)
 
2,205

Income (loss) before income taxes
 
(50,684
)
 
(44,721
)
 
(17,813
)
A reconciliation of amounts computed by applying the German statutory income tax rate to income (loss) before income taxes to total income tax expense (benefit) is as follows:
  
 
Year ended December 31,
(in thousands)
 
2015

 
2016

 
2017

Income (loss) before income taxes
 
(50,684
)
 
(44,721
)
 
(17,813
)
Income tax expense at German tax rate (31.23%)
 
(15,829
)
 
(13,964
)
 
(5,562
)
Foreign rate differential
 
34

 
219

 
33

Expected tax expense (benefit)
 
(15,795
)
 
(13,745
)
 
(5,529
)
Tax effect from:
 

 

 

Non-deductible share-based compensation
 
4,409

 
16,875

 
5,017

Non-deductible corporate costs
 
882

 
1,306

 
34

Changes in uncertain tax positions
 
(1,666
)
 

 

Movement in valuation allowance
 
98

 
1,921

 
(3,517
)
Other differences
 
754

 
313

 
(769
)
Income tax expense (benefit)
 
(11,318
)
 
6,670

 
(4,764
)
Our effective tax rate was 22.3% in 2015, (14.9)% in 2016 and 26.7% in 2017. This is primarily due to non-deductible share-based compensation of (pre-tax) €14.1 million in 2015, €53.7 million in 2016 and €16.0 million in 2017. Furthermore, (pre-tax) corporate costs amounting to €2.8 million for 2015, €4.2 million for 2016 and €0.1 million in 2017 were pushed down from Expedia. These corporate costs are non-deductible for tax purposes. Additional details on the movement in valuation allowance and changes in uncertain tax positions are included below.
Other differences relate to one-off items during the year. In 2015, €0.5 million of the total €0.8 million was related to the non-tax deductible expense for the release of a contingent asset at the level of trivago GmbH. The remainder of the other permanent differences amounts in 2015, 2016 and 2017 relate to individually insignificant non-deductible expenses at the level of trivago GmbH.
Uncertain tax positions
A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows:

Year Ended December 31,
(in thousands)
2015
 
 
2016

 
2017

Balance, beginning of year
 
1,666

 

 

Reductions due to lapsed statute of limitations during current year
 
(1,666
)
 

 

Balance, end of year
 

 

 


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