
7. Income tax
All figures in £ millions |
Notes |
2007 |
2006 |
Current tax |
|
|
|
Charge in respect of current year |
|
(71) |
(81) |
Recognition of previously unrecognised trading losses |
|
– |
23 |
Other adjustments in respect of prior years |
|
27 |
35 |
Total current tax charge |
|
(44) |
(23) |
Deferred tax |
|
|
|
In respect of timing differences |
|
(96) |
(73) |
Recognition of previously unrecognised capital losses |
|
– |
76 |
Recognition of previously unrecognised trading losses |
|
– |
37 |
Other adjustments in respect of prior years |
|
9 |
(21) |
Total deferred tax (charge)/benefit |
13 |
(87) |
19 |
Total tax charge |
|
(131) |
(4) |
The tax on the Group’s profit before tax differs from the theoretical amount that would arise using the UK tax rate as follows:
All figures in £ millions |
2007 |
2006 |
Profit before tax |
468 |
448 |
Tax calculated at UK rate |
(141) |
(135) |
Effect of overseas tax rates |
(25) |
(17) |
Joint venture and associate income reported net of tax |
7 |
7 |
Income not subject to tax |
3 |
5 |
Expenses not deductible for tax purposes |
(12) |
(18) |
Utilisation of previously unrecognised tax losses |
3 |
7 |
Recognition of previously unrecognised tax losses |
– |
136 |
Unutilised tax losses |
(2) |
(3) |
Prior year adjustments |
36 |
14 |
Total tax charge |
(131) |
(4) |
UK |
(42) |
(15) |
Overseas |
(89) |
11 |
Total tax charge |
(131) |
(4) |
Add back: tax benefit on other net gains and losses |
(9) |
(4) |
Add back: tax benefit on amortisation of acquired intangibles |
(19) |
(10) |
Add back: tax (benefit)/charge on other finance income |
(6) |
5 |
Tax amortisation benefit on goodwill and intangibles |
25 |
25 |
Recognition of tax losses |
– |
(127) |
Adjusted income tax charge – continuing operations |
(140) |
(115) |
Adjusted income tax charge – discontinued operations |
(5) |
(15) |
Total adjusted income tax charge |
(145) |
(130) |
Tax rate reflected in adjusted earnings |
26.4% |
25.9% |
The tax benefit on items charged to equity is as follows:
All figures in £ millions |
2007 |
2006 |
Share-based payments |
7 |
2 |
Pension contributions and actuarial gains and losses |
28 |
9 |
Net investment hedges and other foreign exchange gains and losses |
(6) |
1 |
|
29 |
12 |
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