QUADIENT - 2020 Universal Registration Document

FINANCIAL STATEMENTS Consolidated financial statements

TAX POSITION NOTE 13

Accounting principles 13-1:

In accordance with IAS 12, Quadient uses a balance sheet approach to account for deferred taxes. This consists of calculating the deferred tax on temporary differences, which are the difference between the tax base of an asset or liability and its book value on the balance sheet. Quadient also applies the variable carry-forward method. Deferred taxes are valued at the tax rate, either in force or coming into force, which is expected to be applied for the year in which the asset is realized or the liability settled. Due and deferred tax assets and liabilities are offset for a given tax authority where there is a legally enforceable right to offset.

The book value of deferred tax assets is revised at each accounting date and reduced if it is unlikely that adequate taxable profits will be available to make use of the benefit of all or part of the deferred tax asset. Unrecognized deferred tax assets are valued at each accounting date and are recognized if it is probable that future profits will make them recoverable. The Group’s French companies use the tax consolidation system. The same applies to the Group’s subsidiaries in each of the countries in which they are registered.

Main tax rates 13-2:

The rates used in the main countries to calculate current and deferred tax at 31 January 2021 are as follows:

Current tax

Deferred tax

6

32.0 19.0 25.0 26.1 33.0

25.8 19.0 25.0 26.1 33.0

France

United Kingdom

Netherlands

United States

Germany

Tax proof 13-3:

The reconciliation between the theoretical tax charge and the actual tax charge is as follows:

31 January 2021

31 January 2020

Net income of consolidated companies before income tax

65.2

36.8

32.0

34.3

Tax rate for the consolidating company

Theoretical expense

20.9

12.6

Income tax rate differences

(9.6)

(12.5)

ODIRNANE

(2.9)

(3.1)

Permanent differences

11.8

4.7

Tax rate reduction and other non-recurring items *

3.3

19.2

Prior year tax adjustment

0.1

0.5

Other

0.1

(0.0)

TOTAL INCOME TAX

23.8

21.4

EFFECTIVE TAX RATE 58.2 For the financial year 2020, exceptional items mainly include a provision for fiscal risk. In 2019, exceptional items * were mainly composed of permanent differences related to the impairment of goodwill. 36.5

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UNIVERSAL REGISTRATION DOCUMENT 2020