TECHNICOLOR_REGISTRATION_DOCUMENT_2017

- 6 FINANCIAL STATEMENTS Notes to the Parent Company Financial Statements

INCOME TAX NOTE 5. Under French tax law, Technicolor SA is the head Company of the corporate income tax they would have paid if they were taxable French tax consolidation group consisting in 16 companies. Therefore, separately on a standalone basis.

Technicolor SA is responsible to the French Tax Authorities for all corporate income tax matters and is allowed to collect from other members of the French tax consolidation group the amount of

The Company tax losses to carry forward indefinitely by the French tax consolidation group are estimated at € 1,725 million as of December 31, 2017 due mainly to the Cathode Ray Tubes activity disposed in 2005.

Breakdown of booked income tax 5.1. (in million euros) Income tax booked by French subsidiaries and passed on to Technicolor SA (1)

2017

2016

26 19

62 22

Subsidiaries’ research tax credit

Provision for tax-integrated companies

(4) (4)

(8) (3)

Unused foreign tax credits

Other (2)

(14)

(21)

TOTAL INCOME TAX 52 Under French consolidation regime, Technicolor gets a tax income from consolidated French subsidiaries, in particular towards Thomson Licensing SAS (€18 million). (1) Corresponds mainly to research tax credit to be repaid to subsidiaries. The amount to be received for the tax credit to boost competitiveness and employment (CICE) is not (2) significant for 2017. 23

The provision for the income tax expense under tax consolidation for 2017 will be offset with €4 million of foreign withholding tax credits.

In the absence of tax integration, the Company would show a nil net income tax expense.

Variation of deferred or latent tax bases 5.2. Temporarily non-deductible expenses related to Technicolor SA are the following:

December 31, 2016

Variation

December 31, 2017

(in million euros)

To be deducted the following year ■ Paid vacations

2

-

2

Restructuring cost Provisions for risks

1

(1)

-

18

(11)

7 2

Other

2

-

To be deducted at a later date ■ Provisions for retirement

4

(1)

3 6 5 7

Provisions for subsidiary risks Depreciation on current accounts

-

6

60

(55)

Provisions for risks

1

6

Other

2

12

14

265

TECHNICOLOR

REGISTRATION DOCUMENT 2017