Common use of Deferred Tax Clause in Contracts

Deferred Tax. Deferred income tax is provided using the liability method on temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred tax liabilities are recognised for all temporary differences, except: — Where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and — In respect of taxable temporary differences associated with an investment in a subsidiary, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future. Deferred tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised, except: — Where the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and — In respect of deductible temporary differences associated with investment in a subsidiary, deferred income tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised. The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed at each balance sheet date and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be utilised. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the balance sheet date. Deferred income tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax items are recognised in correlation to the underlying transaction either in other comprehensive income or directly in equity. Deferred income tax assets and deferred income tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against current income tax liabilities and the deferred income taxes relate to the same taxable entity and the same taxation authority.

Deferred Tax. Deferred income tax is provided using the liability method on recognized in respect of temporary differences at the balance sheet date between the tax bases carrying amounts of assets and liabilities and their carrying amounts for financial reporting purposes and the amounts used for taxation purposes. Deferred tax liabilities are recognised for all temporary differences, exceptis not recognized for: — Where the deferred tax liability arises from  Temporary differences on the initial recognition of goodwill assets or of an asset or liability liabilities in a transaction that is not a business combination and, at the time of the transaction, and that affects neither the accounting profit nor taxable profit or loss;  Temporary differences related to investments in subsidiaries and — In respect of taxable temporary differences associated with an investment in a subsidiary, where associates to the extent that the Group is able to control the timing of the reversal of the temporary differences can be controlled and it is not probable that the temporary differences they will not reverse in the foreseeable future; and  Taxable temporary differences arising on the initial recognition of goodwill. Deferred tax assets are recognised recognized for all deductible temporary differencesunused tax losses, carry forward of unused tax credits and unused tax losses, deductible temporary differences to the extent that it is probable that future taxable profit profits will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses they can be utilised, except: — Where used. Future taxable profits are determined based on business plans for individual subsidiaries in the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and — In respect of deductible temporary differences associated with investment in a subsidiary, deferred income Group. Deferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised. The carrying amount of deferred tax assets is reviewed at each balance sheet reporting date and are reduced to the extent that it is no longer probable that sufficient the related tax benefit will be realized; such reductions are reversed when the probability of future taxable profit will be available to allow all or part of the deferred tax asset to be utilisedimproves. Unrecognised Unrecognized deferred tax assets are reassessed at each balance sheet reporting date and are recognised recognized to the extent that it has become probable that future taxable profit profits will allow the deferred tax asset to be utilisedavailable against which they can be used. Deferred tax assets and liabilities are is measured at the tax rates that are expected to apply be applied to the year temporary differences when the asset is realised or the liability is settledthey reverse, based on using tax rates and tax laws that have been enacted or substantively enacted at the balance sheet reporting date. Deferred income tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax items are recognised in correlation to the underlying transaction either in other comprehensive income or directly in equity. Deferred income tax assets and deferred income tax liabilities are offset, offset if there is a legally enforceable right exists to set off offset current tax assets against current income tax liabilities and the deferred income taxes assets, and they relate to taxes levied by the same tax authority on the same taxable entity entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realized simultaneously. The Group regularly reviews its deferred tax assets for recoverability, taking into consideration all available evidence, both positive and negative, including historical pre-tax and taxable income, projected future pre-tax and taxable income and the same taxation authorityexpected timing of the reversals of existing temporary differences. In arriving at these judgments, the weight given to the potential effect of all positive and negative evidence is commensurate with the extent to which it can be objectively verified. The Group believes its tax positions are in compliance with applicable tax laws and regulations. Tax benefits are recognized only for tax positions that are more likely than not to be sustained upon examination by tax authorities. The Group believes that its liabilities for unrecognized tax benefits, including related interest, are adequate in relation to the potential for additional tax assessments. There is a risk, however, that the amounts ultimately paid upon resolution of audits could be materially different from the amounts previously included in our income tax expense and, therefore, could have a material impact on our tax provision, net income and cash flows.