BT 2015 Annual Report Download - page 89

87
Overview
The Strategic Report
Purpose and strategy Delivering our strategy 0ur lines of business Group performance
Governance Financial statements Additional information
Taxation
ur eective corporation ta rate was 19.9 copared with 1.
in011. his is slihtl lower in both ears than the UK corporation
ta rate of 1 011 .
Our tax contribution
e are proud to be a aor contributor to the UK econo and have
paidover 1bn of UK corporation ta since privatisation in 19.
his ear we paid UK corporation ta of  011 99.
urUK corporation ta liabilities for the ear were reduced b ta
deductions on our all-eploee share option plan aturities in the
suer of 01 as well as the ta deductible pension deficit paents.
oth these factors will also aect our UK corporation ta paents
in 011. e paid non-UK corporate incoe taes of 
011.
n addition to pain UK corporation ta we pa other taes such as
ploers ational nsurance and usiness ates that represent a
sinificant cost to our business each ear. e are also a aor collector
of taes directl pain incoe ta and ational nsurance due on
our peoples waes and  to the UK cheuer. e describe the
total of the taes that are a true cost to our business and those that
we collect and pa on behalf of our people and custoers as our
otalaontribution.
his ear our otal a ontribution for the UK was .0bn 011
.0bn. he undred roup otal a ontribution urve for 01
raned us as the sith hihest UK contributor. e also contributed
0.bn 011 0.bn in our larest non-UK urisdictions.
Our approach to tax
he wa we approach ta is set centrall at a roup level and is areed b
the oard. ur ain focus is to copl with the ta laws and reulations
in each of the countries in which we do business. ur roup ta tea
supports reional anaeent to eet local ta reulations and reviews
potential ta eposures reularl. e tae the benefit of widel claied
ta incentives reliefs and eeptions in order to reduce the ta cost to
our business. ransactions between roup copanies are paid for as if
between unconnected copanies applin  principles.
e have an open and eective worin relationship with  evenue
ustos and are coitted to this approach with local ta authorities
around the world. his includes discussin the ta ipact of aor
business decisions with the ta authorities when the happen.
Tax expense
ur total ta epense before specific ites was 1 011
1. his is not the sae as the total corporation ta we paid in the
ear because of dierences between ta accountin rules and those for
ain corporation ta paents.
ur eective ta rate on profit before taation and specific ites
is slihtl lower than the UK statutor corporation ta rate. s we
have shown below this is due to the use of non-UK losses prior ear
adustents and other ta adustents which include ta savins fro
claiin incentives and reliefs. n the absence of an other factors
wewould epect our eective ta rate to be around the UK corporation
ta rate as the aorit of our business occurs in the UK.
ear ended 1 arch 2015 01 01
efore specific ites   
rofit before taation 1  
a at UK statutor rate of 1
011  011   0 
on-UK losses utilised  1 1
Prior year adjustments  1 
on-deductible ites 1 1 0
ther ta adustents 20  
ective ta chare 1 1 9
(ƪHFWLYHWD[UDWH 19.9% 21.7% 22.5%
he UK corporation ta rate has been fallin annuall since 1 pril 011.
t chaned fro  to 1 on 1 pril 01 and fro 1 to 0
on 1 pril 01. his has had a aor inuence on our eective ta rate
in recent ears.
e have shown a reconciliation of reported profit before taation which
includes specific ites to total ta epense in note 9 to the consolidated
financial stateents.
Tax losses
e have 0.bn of ta losses 011 1.bn that we have not
iven an value to on our balance sheet.
f these 1.1bn are capital losses arisin in the UK. f the reainin ta
losses of .bn ost arose in our non-UK copanies in earlier financial
ears. e iht be able to use the non-UK losses to oset ta liabilities in
the future but this will depend on us ain profits in countries where we
have previousl ade losses. e have iven ore details in note 9 to the
consolidated financial stateents.