Barclays 2010 Annual Report Download - page 211

9 Tax
Tax charge
2010
£m
2009
£m
2008
£m
Current tax charge/(credit)
Current year 1,413 1,249 1,201
Adjustment for prior years (20) (118) 98
1,393 1,131 1,299
Deferred tax charge/(credit)
Current year 118 45 (577)
Adjustment for prior years 5(102) (269)
123 (57) (846)
Tax charge 1,516 1,074 453
Tax relating to each component of other comprehensive income can be found in the consolidated statement of comprehensive income on page 188,
including within Other, tax credits of £59m (2009: £218m; 2008: £2m charge) principally relating to share based payments.
Factors impacting income tax charge for the year
The table below shows the reconciliation between the tax charge that would result from applying the standard UK corporation tax rate to the Group’s
profit before tax and the actual tax charge.
2010
£m
2009
£m
2008
£m
Profit before tax from continuing operations 6,065 4,585 5,136
Tax charge based on the standard UK corporation tax rate of 28% (2009: 28%, 2008: 28.5%) 1,698 1,284 1,464
Adjustments for prior years (15) (220) (171)
Effect of overseas tax rates different from the standard UK tax ratea(135) (27) 175
Non-taxable gains and incomeb(152) (112) (859)
Impact of share price movements on share-based payments 41 (38) 201
Deferred tax assets (previously not recognised)/not recognised (160) 27 (504)
Change in tax ratesc34 (12) (1)
Non-deductible expenses and other items 205 172 148
Tax charge 1,516 1,074 453
Effective tax rated25% 23% 9%
The introduction of the UK bank levy is expected to result in a charge to operating expenses in 2011 (refer to Note 8).
Current tax assets and liabilities
Movements on current tax assets and liabilities were as follows:
2010
£m
2009
£m
Assets 349 389
Liabilities (992) (1,216)
As at 1st January (643) (827)
Income statement (1,393) (1,153)
Equity 180 (109)
Corporate income tax paid 1,458 1,283
Acquisitions and disposals (4) (33)
Exchange and other adjustments (48) 196
(450) (643)
Assets 196 349
Liabilities (646) (992)
As at 31st December (450) (643)
Notes
a Includes a deferred tax benefit of £205m in 2010 arising from the reorganisation of
Spanish securitisation financing.
b Non-taxable gains and income is net of £42m relating to £58m withholding tax on the
intra-group return of capital. Revenue of £58m has been recognised in relation to related
payments received.
c The UK has passed legislation to reduce the UK tax rate from 28% to 27% from 1st April
2011. This reduced the value of the net UK deferred tax asset at 31st December 2010
resulting in a tax charge of £14m (2009: £nil) included in the £34m for the impact of
change in tax rates.
d The low effective tax rate of 9% in 2008 mainly resulted from the Lehman Brothers North
American business acquisition.
Barclays PLC Annual Report 2010 www.barclays.com/annualreport10 209
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