INCOME TAXES

As our investments are predominantly owned by Dutch holding companies, the components of the provision / credit for income taxes and of the loss before tax have been analyzed between their Netherlands and non-Netherlands components. Similarly the Dutch corporate income tax rates have been used in the reconciliation of income taxes.

Loss from continuing operations before income taxes

The Netherlands and non-Netherlands components of loss from continuing operations before income taxes are:



	For The Year Ending December 31,
	2015			2014			2013
Domestic	$	(73,132	)	$	(117,247	)	$	(80,885	)
Foreign	(29,668		)	(35,576		)	(213,542		)
Total	$	(102,800	)	$	(152,823	)	$	(294,427	)

Total tax credit for the years ended December 31, 2015, 2014 and 2013 was allocated as follows:



	For The Year Ending December 31,
	2015		2014		2013
Income tax credit from continuing operations	$	515	$	1,358	$	17,993
Income tax credit / (provision) from discontinued operations	91		1,987		(968		)
Total tax credit	$	606	$	3,345	$	17,025

Credit for Income Taxes

The Netherlands and non-Netherlands components of the credit for income taxes from continuing operations consist of:



	For The Year Ending December 31,
	2015			2014			2013
Current income tax (expense) / credit:
Domestic	$	—		$	—		$	57
Foreign	(550		)	(558		)	(34		)
	(550		)	(558		)	23
Deferred tax credit:
Domestic	—			—			165
Foreign	1,065			1,916			17,805
	1,065			1,916			17,970
Credit for income taxes	$	515		$	1,358		$	17,993

In 2015 and 2014, the net credit for income taxes is less than a credit computed at statutory tax rates primarily due to losses on which no tax benefit has been received.

Reconciliation of Effective Income Tax Rate

The following is a reconciliation of income taxes, calculated at statutory Netherlands rates, to the credit for income taxes included in the accompanying Consolidated Statements of Operations for the years ended December 31, 2015, 2014 and 2013:



	For The Year Ending December 31,
	2015			2014			2013
Income taxes at Netherlands rates (25%)	$	25,689		$	38,193		$	73,594
Jurisdictional differences in tax rates	(17,462		)	(12,965		)	(13,231		)
Tax effect of goodwill impairment	—			—			(4,979		)
Losses expired	(4,009		)	(4,899		)	(7,439		)
Change in valuation allowance	3,614			(7,012		)	(23,123		)
Non-deductible expenses	(1,859		)	(5,624		)	(7,538		)
Other	(5,458		)	(6,335		)	709
Credit for income taxes	$	515		$	1,358		$	17,993

In 2015 and 2014, the jurisdictional rate difference mainly arises as a result of a loss in Bermuda where there is no income tax. In 2013, it mainly arises as a result of the difference between the Bulgarian and Netherlands' tax rates.

Components of Deferred Tax Assets and Liabilities

The following table shows the significant components included in deferred income taxes as at December 31, 2015 and 2014:



	December 31, 2015			December 31, 2014
Assets:
Tax benefit of loss carry-forwards and other tax credits	$	111,526		$	114,858
Programming rights	4,052			15,158
Property, plant and equipment	4,427			7,533
Accrued expenses	4,544			3,922
Other	1,718			12,718
Gross deferred tax assets	126,267			154,189
Valuation allowance	(109,481		)	(124,263		)
Net deferred tax assets	$	16,786		$	29,926

Liabilities:
Broadcast licenses, trademarks and customer relationships	$	24,897		$	29,620
Property, plant and equipment	173			177
Programming rights	7,082			16,325
Other	75			2,870
Total deferred tax liabilities	32,227			48,992
Net deferred income tax liability	$	15,441		$	19,066

Deferred tax is recognized on the consolidated balance sheet as follows:



	December 31, 2015		December 31, 2014
Net current deferred tax assets	$	10,425	$	8,127
Net non-current deferred tax assets	124		456
	10,549		8,583

Net current deferred tax liabilities	—		279
Net non-current deferred tax liabilities	25,990		27,370
	25,990		27,649

Net deferred income tax liability	$	15,441	$	19,066

We provided a valuation allowance against potential deferred tax assets of US$ 109.5 million and US$ 124.3 million as at December 31, 2015 and 2014, respectively, since it has been determined by management, based on the weight of all available evidence, that it is more likely than not that the benefits associated with these assets will not be realized. During 2015, a valuation allowance of US$ 11.5 million was released in Romania following a period of consistent profitability which resulted in a net credit to the income statement of US$ 6.7 million.

During 2015, we had the following movements on valuation allowances:



Balance at December 31, 2014	$	124,263
Created during the period	13,709
Utilized	(10,631		)
Released due to changes in future profitability	(6,692		)
Foreign exchange	(11,168		)
Balance at December 31, 2015	$	109,481

As of December 31, 2015 we had operating loss carry-forwards that will expire in the following periods:



	2016		2017		2018		2019		2020-35		Indefinite
Bulgaria	$	—	$	—	$	—	$	—	$	11,021	$	—
Croatia	1,488		—		—		—		—		—
Czech Republic	—		48		19,520		—		—		—
The Netherlands	6,991		28,082		26,680		59,315		259,740		—
Romania	—		—		—		15,756		14,493		—
Slovak Republic	5,938		5,938		—		—		—		—
Slovenia	—		—		—		—		—		22,047
United Kingdom	—		—		—		—		—		1,698
Total	$	14,417	$	34,068	$	46,200	$	75,071	$	285,254	$	23,745

The losses are subject to examination by the tax authorities and to restriction on their utilization. In particular, the losses can only be utilized against profits arising in the legal entity in which they arose.

We have provided valuation allowances against most of the above loss carry-forwards. However valuation allowances have not been provided against the loss carry-forwards in our main operating company in the Czech Republic on the basis of future reversals of existing taxable temporary differences. The tax benefits associated with the tax losses in the United Kingdom are only recognized in the financial statements as they are utilized.

As at December 31, 2015 and 2014, we had no undistributed earnings in subsidiaries giving rise to a temporary difference.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:



Balance at December 31, 2012	$	112
Increases for tax positions taken during a prior period	51
Increases for tax positions taken during the current period	20
Decreases resulting from the expiry of the statute of limitations	(75		)
Balance at December 31, 2013	108
Decreases resulting from the expiry of the statute of limitations	(51		)
Other	(4		)
Balance at December 31, 2014	53
Decreases resulting from the expiry of the statute of limitations	(53		)
Balance at December 31, 2015	$	—

We do not anticipate a material increase or decrease in unrecognized tax benefits within the next 12 months.

Our subsidiaries file income tax returns in The Netherlands and various other tax jurisdictions. As at December 31, 2015, our subsidiaries are generally no longer subject to income tax examinations for years before:



Tax Jurisdiction	Year
Bulgaria	2010
Croatia	2011
Czech Republic	2011
The Netherlands	2013
Romania	2014
Slovak Republic	2010
Slovenia	2008
United Kingdom	2014

We recognize, when applicable, both accrued interest and penalties related to unrecognized tax benefits in income tax expense in the accompanying consolidated statements of operations.

There were no significant interest or penalties accrued in the years ended December 31, 2015, 2014 and 2013.