Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Components of Company's Deferred Tax Assets and Liabilities

The significant components of the Company’s deferred tax assets and liabilities are as follows:



	December 31, 2018 $		December 31, 2017 $
Deferred tax assets:
Vessels and equipment	5,868		5,377
Tax losses carried forward and disallowed finance costs ⁽¹⁾	155,910		193,501
Other	10,545		29,355
Total deferred tax assets	172,323		228,233
Deferred tax liabilities:
Vessels and equipment	18,037		9,053
Provisions	5,588		5,153
Other	2,060		8,417
Total deferred tax liabilities	25,685		22,623
Net deferred tax assets	146,638		205,610
Valuation allowance	(144,560	)	(202,513	)
Net deferred tax assets	2,078		3,097

(1)

Substantially all of the Company’s net operating loss carryforwards of $826.3 million relates primarily to its U.K., Spanish, Norwegian and Luxembourg subsidiaries and, to a lesser extent, to its Australian ship-owning subsidiaries. The Company had disallowed finance costs in Spain and Norway of approximately $23.6 million and $15.3 million, respectively, at December 31, 2018, which are available for 18 years and 10 years, respectively, from the year the costs are incurred for offset against future taxable income in Spain and Norway, respectively. The Company's tax losses in Luxembourg are available for offset against taxable future income in Luxembourg, either indefinitely for losses arising prior to 2017, or for 17 years for losses arising subsequent to 2016.

Components of Provision for Income Taxes

The components of the provision for income tax expense are as follows:



	Year Ended December 31, 2018 $		Year Ended December 31, 2017 $		Year Ended December 31, 2016 $
Current	(17,458	)	(11,997	)	(14,424	)
Deferred	(2,266	)	(235	)	(10,044	)
Income tax expense	(19,724	)	(12,232	)	(24,468	)

Reconciliations of Income Tax Rates and Actual Tax Charge

Reconciliations of the tax charge related to the relevant year at the applicable statutory income tax rates and the actual tax charge related to the relevant year are as follows:



	Year Ended December 31, 2018 $		Year Ended December 31, 2017 $		Year Ended December 31, 2016 $
Net (loss) income before taxes	(38,023	)	(516,840	)	111,132
Net (loss) income not subject to taxes	(104,465	)	(297,688	)	57,862
Net income (loss) subject to taxes	66,442		(219,152	)	53,270
At applicable statutory tax rates	15,177		(51,471	)	5,996
Permanent and currency differences, adjustments to valuation allowances and uncertain tax positions	4,639		64,164		18,198
Other	(92	)	(461	)	274
Tax expense related to the year	19,724		12,232		24,468

Unrecognized Tax Benefits, Recorded in Other Long-Term Liabilities

The following is a roll-forward of the Company’s unrecognized tax benefits, recorded in other long-term liabilities, from January 1, 2016 to December 31, 2018:



	Year Ended December 31, 2018 $		Year Ended December 31, 2017 $		Year Ended December 31, 2016 $
Balance of unrecognized tax benefits as at January 1	31,061		19,492		18,390
Increases for positions related to the current year	9,297		2,631		6,422
Changes for positions taken in prior years	981		3,475		(3,729	)
Decreases related to statute of limitations	(783	)	(1,562	)	(1,591	)
Increase due to acquisition of TIL	—		8,528		—
Decrease due to deconsolidation of Teekay Offshore	—		(1,503	)	—
Balance of unrecognized tax benefits as at December 31	40,556		31,061		19,492