Notes to the consolidated financial statements

Deferred tax is calculated in full on temporary differences using tax rates applicable in the jurisdictions where such differences arise. Movements in deferred income tax net liabilities/(assets) in the year are as follows:

(XLS:) Download Excel

Deferred tax

£m

At 1 April 2009

48

Credited to the income statement

(108)

Credited to the statement of comprehensive income

(25)

Credited directly to equity

(1)

Exchange

2

At 31 March 2010

(84)

Charge to the income statement

38

Charge to the statement of comprehensive income

Credited directly to equity

(1)

Exchange

3

At 31 March 2011

(44)

Of the amounts of deferred tax charged to the income statement and other comprehensive income, a credit of £1.8 million (2010 – £0.3 million) arises from changes in tax rates. There was no impact from the imposition of new taxes.

Deferred tax assets in respect of unutilised tax losses of £451 million
(2010 – £371 million) have not been recognised to the extent that they exceed taxable profits against which these assets may be recovered. No unrelieved tax losses expired under current tax legislation in the year ended 31 March 2011.

Deferred tax assets in respect of tax losses of £39 million have been recognised in the current year in relation to the disposal of Fort Dodge. In addition tax losses of £25 million have been recognised in the current year to offset the deferred tax liability arising from the UK pensions surplus.

The total deferred tax on unremitted earnings is £5.5 million (2010 – £3.3 million) of which £0.6 million (2010 – £0.6 million) has been recognised. The Group has not recognised the remaining amount as it is able to control the timing of the reversal of these temporary differences and it is probable that they will not reverse in the foreseeable future.

The aggregate amount of temporary differences arising from unremitted profits at the balance sheet date was approximately £4.9 million (2010 – £2.7 million).

Other deferred tax liabilities principally relate to deferred tax on acquired intangible assets.

Other deferred tax assets principally relate to deferred tax on provisions.

The movements in deferred tax assets and liabilities during the year are as follows:

(XLS:) Download Excel

Deferred tax liabilities

Capital allowances in excess of depreciation
£m

Other
£m

Total
£m

At 1 April 2009

102

54

156

Transfers between categories

(2)

(2)

Credited to the income statement

(94)

(25)

(119)

Exchange

(1)

(4)

(5)

At 31 March 2010

7

23

30

Transfers between categories

(3)

(3)

Charged to the income statement

84

7

91

Charged to the statement of comprehensive income

2

2

Exchange

(6)

(6)

At 31 March 2011

85

29

114

(XLS:) Download Excel

Deferred tax assets

Retirement benefit obligations
£m

Share-based payments
£m

Tax losses
£m

Other
£m

Total
£m

At 1 April 2009

81

2

25

108

Transfers between categories

(2)

(2)

(Charged)/credited to the income statement

(10)

(1)

4

(4)

(11)

Credited/(charged) to the statement of comprehensive income

29

(4)

25

Credited to equity

1

1

Exchange

(6)

(1)

(7)

At 31 March 2010

94

2

4

14

114

Transfers between categories

(3)

(3)

(Charged)/credited to the income statement

(1)

42

12

53

(Charged)/credited to the statement of comprehensive income

(19)

22

(1)

2

Credited to equity

1

1

Exchange

(5)

(4)

(9)

At 31 March 2011

69

3

64

22

158

Deferred tax assets and liabilities are offset where there is a legally enforceable right of offset and there is an intention to settle the balances net.

As a result of these offsets, the deferred tax balances are presented in the statement of financial position as follows:

(XLS:) Download Excel

 

31 March

 

2011
£m

2010
£m

Deferred tax liabilities

30

59

Deferred tax assets

(74)

(143)

Total

(44)

(84)