102
IMI plc
SECTION 2 – RESULTS FOR THE YEAR
Continued
2.4.7 Recognised deferred tax assets and liabilities
Deferred taxes record the tax consequences of temporary differences between the accounting and taxation recognition of certain items, as explained below:
Assets
Liabilities
Net
2014
2013
2014
2013
2014
2013
£m
£m
£m
£m
£m
£m
Non-current assets
3.7
6.1
(40.8)
(59.6)
(37.1)
(53.5)
Inventories
3.5
5.6
(4.1)
(5.5)
(0.6)
0.1
On revaluation of derivatives
1.9
0.5
(2.4)
(2.3)
(0.5)
(1.8)
Employee benefits and provisions
35.2
58.9
(5.4)
(4.3)
29.8
54.6
Other tax assets
2.5
4.0
-
-
2.5
4.0
46.8
75.1
(52.7)
(71.7)
(5.9)
3.4
Set off of tax
(25.5)
(27.4)
25.5
27.4
-
-
Total deferred tax assets and liabilities
21.3
47.7
(27.2)
(44.3)
(5.9)
3.4
Reflected in the balance sheet as follows:
Deferred taxation asset/(liability)
21.3
43.9
(27.2)
(34.3)
(5.9)
9.6
Asset/(liability) held for sale (Section 2.5)
-
3.8
-
(10.0)
-
(6.2)
Total deferred tax assets and liabilities
21.3
47.7
(27.2)
(44.3)
(5.9)
3.4
The movement in the net deferred tax balances has been recognised in the financial statements as analysed below:
Recognised Recognised
in the outside the
Balance at
income
income
Balance at
1 Jan 14
statement
statement
Exchange Acquisitions 31 Dec 14
£m
£m
£m
£m
£m
£m
Non-current assets
(53.5)
7.1
-
(0.2)
9.5
(37.1)
Inventories
0.1
(2.4)
-
(0.2)
1.9
(0.6)
On revaluation of derivatives
(1.8)
(0.9)
2.3
(0.1)
-
(0.5)
Employee benefits and provisions
54.6
(15.8)
(4.8)
-
(4.2)
29.8
Other tax assets
4.0
(0.5)
-
(0.3)
(0.7)
2.5
Net deferred tax asset/(liability)
3.4
(12.5)
(2.5)
(0.8)
6.5
(5.9)
Recognised Recognised
in the outside the
Balance at
income
income
Balance at
1 Jan 13 statement
statement
Exchange Acquisitiions 31 Dec 13
£m
£m
£m
£m
£m
£m
Non-current assets
(55.4)
6.3
-
1.0
(5.4)
(53.5)
Inventories
(0.8)
1.0
-
(0.1)
-
0.1
On revaluation of derivatives
0.2
0.8
(2.7)
(0.1)
-
(1.8)
Employee benefits and provisions
80.5
(5.3)
(20.8)
0.2
-
54.6
Other tax assets
4.4
(0.5)
-
0.1
-
4.0
Net deferred tax asset
28.9
2.3
(23.5)
1.1
(5.4)
3.4
All exchange movements are taken through the translation reserve.
2.4.8 Unrecognised deferred tax assets and liabilities
Deferred tax assets of £39.8m (2013: £29.0m) have not been recognised in respect of tax losses of £16.1m (2013: £12.4m), interest of £40.4m (2013: £30.6m)
and capital losses of £113.3m (2013: £83.2m). The majority of the tax losses have no expiry date. No deferred tax asset has been recognised for these temporary
differences due to uncertainty over their offset against future taxable profits and therefore their recoverability.
It is likely that the majority of unremitted earnings of overseas subsidiaries would qualify for the UK dividend exemption. However £81.7m (2013: £78.0m) of those
earnings may still result in a tax liability principally as a result of withholding taxes levied by the overseas jurisdictions in which those subsidiaries operate. These tax
liabilities are not expected to exceed £8.1m (2013: £7.9m), of which only £2.0m (2013: £1.5m) has been provided as the Group is able to control the timing of the
dividends. It is not expected that further amounts will crystallise in the foreseeable future.
