BT 2016 Annual Report Download - page 182

188 BT Group plc
Annual Report 2016
9. Taxation
Analysis of taxation expense for the year
Year ended 31 March
2016
£m
2015
£m
2014
£m
United Kingdom
Corporation tax at 20% (2014/15: 21%, 2013/14: 23%) (617) (655) (693)
Adjustments in respect of earlier years 59 35 10
Non-UK taxation
Current (80) (60) (65)
Adjustments in respect of earlier years 29 18 3
Total current tax expense (609) (662) (745)
Deferred taxation
Origination and reversal of temporary differences 70 170 239
Adjustments in respect of prior periods 2(18) 4
Impact of change in UK corporation tax rate to 19% and 18% (2013/14: 20%) 96 –208
Total deferred taxation credit 168 152 451
Total taxation expense (441) (510) (294)
Factors affecting taxation expense for the year
The taxation expense on the profit for the year differs from the amount computed by applying the UK corporation tax rate to the profit
before taxation as a result of the following factors:
Year ended 31 March
2016
£m
2015
£m
2014
£m
Profit before taxation 3,029 2,645 2,312
Expected taxation expense at UK rate of 20% (2014/15: 21%, 2013/14: 23%) (606) (555) (532)
Effects of:
Higher taxes on non-UK profits (4) (9) (5)
Net permanent differences between tax and accountinga,d (12) (4) (9)
Adjustments in respect of earlier yearsb90 35 17
Non-UK losses used against current year profits 26 36 13
Non-UK losses not recognisedc(18) (37) (40)
Other deferred tax assets not recognised 6 9 54
Lower taxes on profit on disposal of business – 7 –
Re-measurement of deferred tax balances 96 –208
Other non-recurring itemsd(19) 8 –
Total taxation expense (441) (510) (294)
Exclude specific items (note 8) (166) (121) (319)
Total taxation expense before specific items (607) (631) (613)
a Includes income that is not taxable or UK income taxable at a different rate, and expenses for which no tax relief is received. Examples include some types of depreciation and amortisation and the benefit of
R&D tax incentives.
b Reflects the differences between initial accounting estimates and tax returns submitted to tax authorities, including the release and establishment of provisions for uncertain tax positions.
c Reflects losses made in countries where it has not been considered appropriate to recognise a deferred tax asset, as the potential for future taxable profits is not sufficiently certain and we have not agreed
the value of tax losses with local authorities.
d Following the acquisition of EE, we have expanded the categories of factors affecting the total taxation expense. Prior year amounts are presented on a consistent basis.