Vodafone 2007 Annual Report Download - page 106
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104 Vodafone Group Plc Annual Report 2007
Notes to the Consolidated Financial Statements
continued
6. Taxation
(Loss)/profit before tax is split as follows:
2007 2006 2005
£m £m £m
United Kingdom (loss)/profit before tax (375) 491 765
Overseas (loss)/profit before tax (2,008) (15,344) 6,520
Total (loss)/profit before tax (2,383) (14,853) 7,285
Income tax expense
Income tax expense from continuing operations, as shown in the income statement, is as follows:
2007 2006 2005
£m £m £m
United Kingdom corporation tax (income)/expense at 30%:
Current year −169 339
Adjustments in respect of prior years (30) (15) (79)
(30) 154 260
Overseas current tax expense/(income):
Current year 2,928 2,077 1,774
Adjustments in respect of prior years 215 (418) (154)
3,143 1,659 1,620
Total current tax expense 3,113 1,813 1,880
Deferred tax on origination and reversal of temporary differences:
United Kingdom deferred tax (49) 444 234
Overseas deferred tax (641) 123 (245)
Total deferred tax (income)/expense (690) 567 (11)
Total income tax expense from continuing operations 2,423 2,380 1,869
Tax included in the statement of recognised income and expense 2007 2006 2005
£m £m £m
Current tax credit (2) (6) (10)
Deferred tax charge/(credit) 11 (11) (35)
Total tax charged/(credited) directly to equity 9 (17) (45)
Factors affecting tax expense for the year
The table below explains the differences between the expected tax expense on continuing operations, at the UK statutory tax rate of 30% for 2007, 2006 and
2005, and the Group’s total tax expense for each year. Further discussion of the current year tax expense can be found in the section titled “Performance –
Operating Results”.
2007 2006 2005
£m £m £m
(Loss)/profit before tax on continuing operations as shown in the consolidated income statement (2,383) (14,853) 7,285
Expected income tax (income)/expense on profit from continuing operations at UK statutory tax rate (715) (4,456) 2,186
Effect of taxation of associated undertakings, reported within operating profit 119 133 134
Impairment losses with no tax effect 3,480 7,055 143
Expected income tax expense at UK statutory rate on profit from continuing operations,
before impairment losses and taxation of associates 2,884 2,732 2,463
Effect of different statutory tax rates of overseas jurisdictions 346 411 433
Deferred tax on overseas earnings (373) (78) (66)
Assets revalued for tax purposes (197) (142) (240)
Effect of previously unrecognised temporary differences including losses (562) (95) (389)
Adjustments in respect of prior years 145 (470) (315)
Expenses not deductible for tax purposes and other items 578 465 431
Exclude taxation of associated undertakings (398) (443) (448)
Income tax expense from continuing operations 2,423 2,380 1,869