Virgin Media 2010 Annual Report Download - page 140

VIRGIN MEDIA INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
Note 14—Income Taxes
The benefit (expense) for income taxes consists of the following (in millions):
Year ended December 31,
2010 2009 2008
Current:
Federal .................................................. £ (4.9) £ 1.5 £(0.2)
State and local ............................................ 0.3 (0.1) —
Foreign .................................................. 25.0 4.9 4.7
Total current ................................................. 20.4 6.3 4.5
Deferred:
Federal .................................................. 79.8 (3.8) (1.1)
Foreign .................................................. 23.9 — 3.4
Total deferred ................................................ 103.7 (3.8) 2.3
Total ........................................................ £124.1 £ 2.5 £ 6.8
The foreign current tax benefit includes £18.3 million related to the income on discontinued operations and
£6.7 million related to amounts receivable in respect of the sale of U.K. tax losses to an equity method investee.
During 2010, we concluded that it was more likely than not that we would be able to utilize certain net operating
loss carry forwards prior to their expiration, which will occur between 2020 and 2030, to reduce future U.S.
federal income tax liabilities. Accordingly, we reduced the previously established valuation allowance on these
net operating loss carry forwards to nil and recorded a federal deferred tax benefit of £79.8 million. The foreign
deferred tax benefit relates to amounts included in the consolidated statement of other comprehensive income.
The foreign current tax benefit from discontinued operations and the deferred tax benefit from other
comprehensive income arise due to the application of the intraperiod allocation rules of the Income Taxes Topic
of the FASB ASC. Tax expense of £18.3 million and £23.9 million is included as a component of the tax expense
attributable to income on discontinued operations and other comprehensive income, respectively.
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