RWS AR 23 Final Single pages - Flipbook - Page 129
The Group periodically reviews its historic UTPs for transfer pricing and whilst it is not possible to predict the outcome
of any pending tax authority investigations, adequate provisions are considered to be included in the Group accounts
to cover any expected estimated future settlement. In carrying out this review, and subsequent quanti昀椀cation,
Management has made judgements, taking into account: the status of any unresolved matters; strength of technical
argument and clarity of legislation; external advice, statute of limitations and any expected recoverable amounts under
the Mutual Agreement Procedure ('MAP'). During the period the Group reduced the provision for liabilities that are
expected to no longer be sought by tax authorities on the basis that the relevant statute of limitations has expired. In
addition, UTPs related to transfer pricing were increased during the year to re昀氀ect current period trading as well as new
historic risks identi昀椀ed during the period.
The current tax liability of £15.3m on the balance sheet comprises £9.7m of UTPs, although it is not expected that these
will be cash settled within 12 months of the year end date. The deferred tax liability of £57.7m on the balance sheet is net
of £3.0m of deferred tax assets relating to uncertain tax positions.
Pillar Two
On 20 December 2021, the OECD published their proposals in relation to Global Anti-Base Erosion Rules, which provide for an
internationally co-ordinated system of taxation to ensure that large multinational groups pay a minimum level of corporate
income tax in countries where they operate. The UK enacted its Pillar Two legislation in July 2023 which will require UK
multinational entities to comply with the Pillar Two rules for periods starting after 31 December 2023 which for RWS will be
the period ended 30 September 2025. As the Pillar Two rules are not yet in force, RWS has not sought to quantify the known
or reasonably estimated impact of the Pillar Two rules in this set of 昀椀nancial statements.
Share based
payments
£m
Accelerated
capital
allowances
£m
Other
temporary
di昀昀erences
£m
Acquired
intangibles
£m
Tax losses
£m
Total
£m
0.6
(1.7)
6.8
(71.6)
16.2
(49.7)
Adjustments in respect of prior years
-
(0.1)
1.7
-
(4.2)
(2.6)
Acquisitions
-
-
-
(2.5)
-
(2.5)
Deferred tax
At 30 September 2021
Credited to income
Charged to equity / OCI
Foreign exchange di昀昀erences
At 30 September 2022
-
-
0.4
4.4
(2.5)
2.3
(0.1)
-
-
-
-
(0.1)
-
-
0.9
(6.0)
0.4
(4.7)
(57.3)
0.5
(1.8)
9.8
(75.7)
9.9
Adjustments in respect of prior years
-
(0.1)
(0.1)
0.1
(2.3)
(2.4)
Acquisitions
-
-
-
(1.3)
-
(1.3)
0.2
-
1.7
4.4
(0.6)
5.7
-
-
-
-
(2.8)
(2.8)
(0.2)
-
-
-
-
(0.2)
Credited to income
Transfers to current taxes
Charged to equity / OCI
Foreign exchange di昀昀erences
At 30 September 2023
-
-
(1.4)
3.4
(0.2)
1.8
0.5
(1.9)
10.0
(69.1)
4.0
(56.5)
Deferred tax assets and liabilities are presented on the balance sheet after jurisdictional netting as follows:
Deferred tax assets
2023
£m
2022
£m
1.2
1.1
Deferred tax liabilities
(57.7)
(58.4)
Net deferred tax liability
(56.5)
(57.3)
Deferred tax assets and liabilities
Deferred tax is calculated using tax rates that are expected to apply in the period when the liability has been settled or
the asset realised based on tax rates that have been enacted or substantively enacted at the reporting date.
Most deferred tax assets are recognised because they can o昀昀set the future taxable income from existing taxable
di昀昀erences (primarily on acquired intangibles) relating to same jurisdiction or entity. Where there are insu昀케cient taxable
di昀昀erences, deferred tax assets are recognised in respect of losses and other deductible di昀昀erences where current
forecasts indicate pro昀椀ts will arise in future periods against which they can be deducted.
NOTES TO THE CONSOLIDATED STATEMENTS
RWS Holdings plc — Annual Report 2023
129
