2021 UNIVERSAL REGISTRATION DOCUMENT

Additions to provisions net of reversals and expense transfers chiefly concern:

€ millions	31.12.2021	31.12.2020	31.12.2019
Financial investments⁽¹⁾	Financial investments ⁽¹⁾31.12.2021 -40.4	Financial investments ⁽¹⁾31.12.2020 -79.8	Financial investments ⁽¹⁾31.12.2019 -181.4
Impairment of other financial assets	Impairment of other financial assets 31.12.2021 -	Impairment of other financial assets 31.12.2020 -	Impairment of other financial assets 31.12.2019 -
Impairment of Treasury shares	Impairment of Treasury shares 31.12.2021 -	Impairment of Treasury shares 31.12.2020 -	Impairment of Treasury shares 31.12.2019 -
Provisions for liabilities and charges relating to financial items⁽²⁾	Provisions for liabilities and charges relating to financial items ⁽²⁾31.12.2021 -143.0	Provisions for liabilities and charges relating to financial items ⁽²⁾31.12.2020 2.7	Provisions for liabilities and charges relating to financial items ⁽²⁾31.12.2019 -17.2
Other	Other 31.12.2021 -	Other 31.12.2020 -	Other 31.12.2019 -
TOTAL	TOTAL31.12.2021-183.4	TOTAL31.12.2020-77.1	TOTAL31.12.2019-198.6

(1)In 2020, this mainly related to the impairment of shares in Cosmeurop and Elebelle Limited. In 2019, this mainly related to the impairment of shares in Magic Holdings.

(2)In 2021, this mainly related to provisions for currency risk amounting to -€150.7 million.

NOTE 7. Exceptional items

Exceptional items represented €2.1 million in 2021, compared to -€156.4 million in 2020 and €22.5 million in 2019.

NOTE 8. Income tax

The income tax breaks down as follows:

€ millions	31.12.2021	31.12.2020	31.12.2019
Tax on profit before tax and exceptional items	Tax on profit before tax and exceptional items 31.12.2021 -82.3	Tax on profit before tax and exceptional items 31.12.2020 -39.8	Tax on profit before tax and exceptional items 31.12.2019 -87.6
Tax on exceptional items and employee Profit Sharing	Tax on exceptional items and employee Profit Sharing 31.12.2021 80.6	Tax on exceptional items and employee Profit Sharing 31.12.2020 17.0	Tax on exceptional items and employee Profit Sharing 31.12.2019 4.9
INCOME TAX	INCOME TAX31.12.2021-1.7	INCOME TAX31.12.2020-22.8	INCOME TAX31.12.2019 -82.7

In 2021, the tax charge recognised by L’Oréal reflected €53.3 million in savings resulting from tax consolidation.

In 2020, the tax charge recognised by L’Oréal included a tax consolidation loss of €0.3 million.

In 2019, the tax charge recorded by L’Oréal included a tax consolidation loss of €4.1 million and €55.5 million for the agreement with the French Tax Administration regarding the disagreement over which French business products fall under the tax base for 2014 to 2018.

NOTE 9. Increases or reductions in future tax liabilities

		31.12.2019		31.12.2020		Changes		31.12.2021
€ millions	Assets	Liabilities	Assets	Liabilities	Assets	Liabilities	Assets	Liabilities
Temporary differences	Temporary differences	Temporary differences31.12.2019	Temporary differences	Temporary differences31.12.2020	Temporary differences	Temporary differencesChanges	Temporary differences	Temporary differences31.12.2021
Regulated provisions	Regulated provisions -	Regulated provisions 31.12.2019 15.9	Regulated provisions -	Regulated provisions 31.12.2020 10.2	Regulated provisions 3.7	Regulated provisions Changes 1.1	Regulated provisions -	Regulated provisions 31.12.2021 7.6
Temporarily non-deductible charges	Temporarily non-deductible charges 95.3	Temporarily non-deductible charges 31.12.2019 -	Temporarily non-deductible charges 116.3	Temporarily non-deductible charges 31.12.2020 -	Temporarily non-deductible charges 40.9	Temporarily non-deductible charges Changes 24.4	Temporarily non-deductible charges 132.8	Temporarily non-deductible charges 31.12.2021 -
Charges deducted (or revenue taxed) for tax purposes but not yet recognised	Charges deducted (or revenue taxed) for tax purposes but not yet recognised -	Charges deducted (or revenue taxed) for tax purposes but not yet recognised 31.12.2019 16.1	Charges deducted (or revenue taxed) for tax purposes but not yet recognised -	Charges deducted (or revenue taxed) for tax purposes but not yet recognised 31.12.2020 0.2	Charges deducted (or revenue taxed) for tax purposes but not yet recognised -	Charges deducted (or revenue taxed) for tax purposes but not yet recognised Changes 43.7	Charges deducted (or revenue taxed) for tax purposes but not yet recognised -	Charges deducted (or revenue taxed) for tax purposes but not yet recognised 31.12.2021 43.8
Temporarily non-taxable revenue	Temporarily non-taxable revenue -	Temporarily non-taxable revenue 31.12.2019 -	Temporarily non-taxable revenue -	Temporarily non-taxable revenue 31.12.2020 -	Temporarily non-taxable revenue -	Temporarily non-taxable revenue Changes -	Temporarily non-taxable revenue -	Temporarily non-taxable revenue 31.12.2021 -
Deductible items	Deductible items	Deductible items31.12.2019	Deductible items	Deductible items31.12.2020	Deductible items	Deductible itemsChanges	Deductible items	Deductible items31.12.2021
Tax losses, deferred items	Tax losses, deferred items -	Tax losses, deferred items 31.12.2019 -	Tax losses, deferred items -	Tax losses, deferred items 31.12.2020 -	Tax losses, deferred items -	Tax losses, deferred items Changes -	Tax losses, deferred items -	Tax losses, deferred items 31.12.2021 -
Potentially taxable items	Potentially taxable items	Potentially taxable items31.12.2019	Potentially taxable items	Potentially taxable items31.12.2020	Potentially taxable items	Potentially taxable itemsChanges	Potentially taxable items	Potentially taxable items31.12.2021
Special reserve for long-term capital gains	Special reserve for long-term capital gains -	Special reserve for long-term capital gains 31.12.2019 169.9	Special reserve for long-term capital gains -	Special reserve for long-term capital gains 31.12.2020 150.7	Special reserve for long-term capital gains 13.7	Special reserve for long-term capital gains Changes -	Special reserve for long-term capital gains -	Special reserve for long-term capital gains 31.12.2021 137.0

These figures factor in the social contribution of 3.3% which is added to corporate income tax, both at normal and reduced rates, and the reduction in the tax rate in 2022.

NOTE 10. Research costs

Expenses booked for Research activities in 2021 totalled €1,040.7 million, compared with €976.6 million in 2020 and €1,015.8 million in 2019.

2021 UNIVERSAL REGISTRATION DOCUMENT

6. Parent company financial statements

NOTE 7. Exceptional items

NOTE 8. Income tax

NOTE 9. Increases or reductions in future tax liabilities

NOTE 10. Research costs