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FINANCIAL STATEMENTS
8 INCOME TAX Income tax recognised in profit or loss
Year ended 31 December 2020 £m
Year ended 31 December 2019 £m
Current taxation Current year
46.6
67.9
1.0
Adjustments in respect of prior periods
(2.9)
Total current tax
47.6
65.0
Deferred taxation Origination and reversal of temporary differences
(4.0) (0.9)
1.8
Adjustments in respect of prior periods
(0.5) (0.1)
1.5
Rate change
Total deferred tax
(3.4)
1.2
Total income tax recognised in profit or loss
44.2
66.2
The current taxation adjustment in respect of prior periods relates to the conclusion of the transfer pricing enquiry with HMRC.
A change to the main UK corporation tax rate, announced in the Budget on 11 March 2020, was substantively enacted on 17 March 2020. The rate applicable from 1 April 2020 now remains at 19%, rather than the previously enacted reduction to 17%. The effect of this change is that the net deferred tax balances carried forward increased by £1.5m. On 3 March 2021, the Government announced an increase in the rate of corporation tax rate to 25% from 1 April 2023. The change in rate has yet to be substantively enacted, and the impact of the rate change will not be material for the financial statements. The deferred tax assets and liabilities at 31 December 2020 have been calculated based on the rate at which they are expected to reverse. Reconciliation of total income tax to the applicable tax rate Year ended 31 December 2020 £m Year ended 31 December 2019 £m Profit/(loss) on ordinary activities before tax 236.7 368.6 Income tax at 19% (2019: 19%) 45.0 70.0 Effects of: Expenses not deductible for tax purposes 2.0 1.1 Rate change 1.5 (0.2) Higher rate for overseas income (0.1) (0.3) Unrecognised deferred tax asset 1.3 1.8 Adjustments in respect of prior periods 0.1 (3.4) Relief on Tier 1 interest included in equity (5.3) (3.2) Other (0.3) 0.4 Total income tax recognised in profit or loss 44.2 66.2
Income tax recognised in other comprehensive income
Year ended 31 December 2020 £m
Year ended 31 December 2019 £m
Deferred taxation Revaluation of land and buildings
(0.1) (0.1) (0.1)
– – –
Total deferred tax
Total income tax recognised in other comprehensive income
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