National Grid 2016 Annual Report Download - page 118

6. Tax continued
Tax included within the statement of financial position
The following are the major deferred tax assets and liabilities recognised, and the movements thereon, during the current and prior
reportingperiods:
Accelerated
tax
depreciation
£m
Share-
based
payment
£m
Pensions
and other
post-
retirement
benefits
£m
Financial
instruments
£m
Other net
temporary
differences
£m
Total
£m
Deferred tax (assets)/liabilities
Deferred tax assets at 31 March 2014 (1) (22) (960) (13) (796) (1,792)
Deferred tax liabilities at 31 March 2014 5,650 –143 675 5,874
At 1 April 2014 5,649 (22) (817) (7) (721) 4,082
Exchange adjustments 408 –(99) (2) (104) 203
Charged/(credited) to income statement 599 138 (34) (280) 324
Charged/(credited) to other comprehensive income and equity – 3 (299) (16) –(312)
At 31 March 2015 6,656 (18) (1,177 ) (59) (1,105) 4,297
Deferred tax assets at 31 March 2015 (1) (18) (1,337) (64) (1,186) (2,606)
Deferred tax liabilities at 31 March 2015 6,657 –160 581 6,903
At 1 April 2015 6,656 (18) (1,177 ) (59) (1,105) 4,297
Exchange adjustments and other 141 1(33) (1) (30) 78
Charged/(credited) to income statement 266 347 (6) (203) 107
Charged to other comprehensive income and equity – – 125 13 14 152
At 31 March 2016 7,063 (14) (1,038) (53) (1,324) 4,634
Deferred tax assets at 31 March 2016 (1) (14) (1,201) (66) (1,408) (2,690)
Deferred tax liabilities at 31 March 2016 7, 0 6 4 –163 13 84 7, 324
7, 0 6 3 (14) (1,038) (53) (1,324) 4,634
Deferred tax assets and liabilities are only offset where there is a legally enforceable right of offset and there is an intention to settle the
balances net. The deferred tax balances (after offset) for statement of financial position purposes consist solely of deferred tax liabilities
of£4,634m (2015: £4,297m). Deferred tax of £667m (2015: £461m) has been recognised in respect of net operating losses.
Deferred tax assets in respect of capital losses, trading losses and non-trade deficits have not been recognised as their future recovery
isuncertain or not currently anticipated. The deferred tax assets not recognised are as follows:
2016
£m
2015
£m
Capital losses 232 250
Non-trade deficits 51
Trading losses –4
The capital losses and non-trade deficits that arise in the UK are available to carry forward indefinitely. However, the capital losses can only
beoffset against specific types of future capital gains and non-trade deficits against specific future non-trade profits. The trading losses arising
in the US have up to a 20 year carry forward time limit.
The aggregate amount of temporary differences associated with the unremitted earnings of overseas subsidiaries and joint ventures for
whichdeferred tax liabilities have not been recognised at the reporting date is approximately £502m (2015: £773m). No liability is recognised
in respect of the differences because the Company and its subsidiaries are in a position to control the timing of the reversal of the temporary
differences and it is probable that such differences will not reverse in the foreseeable future. In addition, as a result of UK tax legislation,
which largely exempts overseas dividends received, the temporary differences are unlikely to lead to additional tax.
Notes to the consolidated financial statements
– analysis of items in the primary statements continued
116 National Grid Annual Report and Accounts 2015/16 Financial Statements