HSBC 2001 Annual Report Download - page 180

HSBC HOLDINGS PLC
Notes on the Financial Statements (continued)
178
HSBC Holdings and its subsidiary undertakings in the United Kingdom provide for UK corporation tax at 30.0%
(2000: 30.0%;1999: 30.25%). Overseas tax includes Hong Kong profits tax of US$450 million (2000: US$478
million; 1999: US$367 million). Subsidiary undertakings in Hong Kong provide for Hong Kong profits tax at the
rate of 16.0% (2000: 16.0%; 1999: 16.0%) on the profits for the year assessable in Hong Kong. Other overseas
subsidiary undertakings and overseas branches provide for taxation at the appropriate rates in the countries in which
they operate. The tax charge in 2001 benefited from increased tax-free gains in Hong Kong, a material capital gain in
the UK covered by previously unrecognised capital losses, prior year tax credits as a result of settlement of prior year
computations, and the release of valuation reserves against a number of potential deferred tax assets in light of a
demonstrated record of relevant tax capacity. Offsetting this, no tax relief was assumed in respect of the exceptional
charges in respect of Argentina.
Analysis of overall tax charge:
2001 2000 1999
US$m US$m US$m
Taxation at UK corporate tax rate of 30.0% (2000: 30.0%,
1999: 30.25%) .......................................................................... 2,400 2,932 2,415
Impact of differently taxed overseas profits in principal locations (616) (498) (418)
Unrecognised/(previously unrecognised) tax benefits ................. (499) (137) 35
Tax free gains................................................................................ (102) (15) –
Argentine losses............................................................................ 336 ––
Goodwill amortisation .................................................................. 263 172 11
Other items.................................................................................... (208) (216) (5)
Overall tax charge ......................................................................... 1,574 2,238 2,038
9 Profit of HSBC Holdings
2001 2000 1999
US$m US$m US$m
Profit on ordinary activities before tax.......................................... 3,211 4,224 2,478
Tax credit on profit on ordinary activities..................................... 183 227 87
Profit for the financial year attributable to shareholders ....... 3,394 4,451 2,565
Profit on ordinary activities before tax includes dividend income from subsidiary undertakings for the years ended
31 December as follows:
2001 2000 1999
US$m US$m US$m
Bank.............................................................................................. 2,156 1,727 1,776
Non-bank ...................................................................................... 1,251 2,598 742
10 Dividends
2001 2000 1999
US$ per
share US$m
US$ per
share US$m
US$ per
share US$m
First interim.................................... 0.190 1,767 0.150 1,383 0.133 1,118
Second interim............................... 0.290 2,700 0.285 2,627 0.207 1,754
0.480 4,467 0.435 4,010 0.340 2,872