Tesco 2015 Annual Report Download - page 104

Note 6 Taxation continued
Deferred tax
The following are the major deferred tax (liabilities)/assets recognised by the Group and movements thereon during the current and prior financial years:
Property-
related
items*
£m
Retirement
benefit
obligation
£m
Share-based
payments
£m
Short-term
timing
differences
£m
Tax losses
£m
Financial
Instruments
£m
Other
pre/post
tax
temporary
differences
£m
Total
£m
At 23 February 2013 (1,622) 539 21 83 40 (24) 7(956)
Credit/(charge) to the Group Income Statement 282 29 19 9(19) 2 3 325
Charge to the Group Statement of Changes in Equity – – (1) – – – – (1)
Credit to the Group Statement of Comprehensive
Income –67 –––35 –102
Discontinued operations – – 3 5 7 – – 15
Business combinations – – – – – – – –
Foreign exchange and other movements** 32 (1) –(13) (4) – – 14
At 22 February 2014 (1,308) 634 42 84 24 13 10 (501)
Credit/(charge) to the Group Income Statement 363 35 (40) 184 46 (6) (9) 573
Charge to the Group Statement of Changes in Equity – – – – – – – –
Credit/(charge) to the Group Statement of
Comprehensive Income –291 – – – (17) –274
Discontinued operations 2 – – (19) (2) – – (19)
Business combinations – – – – – – – –
Foreign exchange and other movements** (10) (3) 1(1) 1 – – (12)
At 28 February 2015 [phone] 69 (10) 1315
* Property-related items include a deferred tax liability on rolled over gains of £294m (2014: £294m) and deferred tax assets on capital losses of £101m (2014: £58m).
The remaining balance relates to accelerated tax depreciation.
**
The deferred tax charge/credit for foreign exchange and other movements is £12m debit (2014: £14m credit) relating to the retranslation of deferred tax balances at the
balance sheet date and is included within the Group Statement of Comprehensive Income under the heading currency translation differences.
Certain deferred tax assets and liabilities have been offset and are analysed as follows:
2015
£m
2014
£m
Deferred tax assets 514 73
Deferred tax liabilities (199) (594)
Deferred tax assets/(liabilities) relating to disposal groups –20
315 (501)
Unrecognised deferred tax assets and liabilities
No deferred tax liability is recognised on temporary differences of £3.0bn (2014: £4.0bn) relating to the unremitted earnings of overseas subsidiaries and joint
ventures as the Group is able to control the timing of the reversal of these temporary differences and it is probable that they will not reverse in the foreseeable
future. The deferred tax on unremitted earnings at 28 February 2015 is estimated to be £200m (2014: £213m) which relates to taxes payable on repatriation
and dividend withholding taxes levied by overseas tax jurisdictions. UK tax legislation relating to company distributions provides for exemption from tax for
most repatriated profits, subject to certain exceptions.
Deferred tax assets in relation to continuing operations have not been recognised in respect of the following items (because it is not probable that future
taxable profits will be available against which the Group can utilise the benefits):
2015
£m
2014
£m
Deductible temporary differences 97 27
Tax losses 66 66
163 93
As at 28 February 2015, the Group has unused trading tax losses from continuing operations of £631m (2014: £398m) available for offset against future
profits. A deferred tax asset has been recognised in respect of £335m (2014: £95m) of such losses. No deferred tax asset has been recognised inrespect of
the remaining £296m (2014: £303m) due to the unpredictability of future profit streams. Included in unrecognised tax losses are losses of £118m that will
expire by 2019 (2014: £71m by 2018) and £15m that will expire between 2020 and 2035 (2014: £142m between 2019 and 2034). Other losses will be carried
forward indefinitely.
102 Tesco PLC Annual Report and Financial Statements 2015
Notes to the Group financial statements continued