Notes to the Group Financial Statements (continued)
for the year ended 31st December 2012
13. taxation (continued)
b. Factors affecting tax charge for the year
The tax assessed in the profit and loss account is lower (2011: lower) than the standard UK corporation tax rate, because of the following factors:
2012 2011
£’000 £’000
Profit on ordinary activities before tax 6,733 17,592
Tax calculated at UK standard rate of corporation tax rate of 24.5% (2011 – 26.5%) 1,650 4,662
Non taxable negative goodwill on acquisition – (24)
Non taxable income from joint ventures (314) (180)
Benefit of deferred tax asset not previously recognised (49) 75
Disallowable expenses 295 622
Impact of movement in contingent consideration charge to income statement 1,017 –
Share-based payment relief 29 141
Temporary differences on non-qualifying properties no longer recognised (1,060) (380)
Impact of rate change on deferred tax (289) (390)
Others – 94
1,279 4,620
Prior period adjustments – current tax (1,407) 159
Prior period adjustment – deferred tax (156) (422)
Total taxation (benefit)/charge (284) 4,357
c. Factors that may affect future tax charges (unrecognised)
2012 2011
£’000 £’000
unrecognised deferred tax asset relating to:
Property, plant and equipment temporary differences – 10
Losses 3,277 5,693
3,277 5,703
No (2011: £nil) unrecognised deferred tax on losses carried forward relates to acquisitions during the year. The deferred tax assets in respect
of property, plant and equipment temporary differences, other temporary differences and losses may be recoverable in the future and this is
dependent on subsidiary companies generating taxable profits sufficient to allow the utilisation of these amounts. These deferred tax assets cannot
be offset against profits elsewhere in the Group as they relate to losses brought forward which can only be offset against taxable profits arising from
the same trade in which the losses arose. There is no time limit for utilisation of the above tax losses and other temporary differences.
d. Deferred tax
An analysis of the movements in deferred tax is as follows:
2012 2011
£’000 £’000
Net deferred tax liability/(asset) at 1st January 4,772 2,183
Deferred tax liability arising on business combinations 110 3,775
Deferred tax liability recognised directly in equity 2,456 –
Deferred tax credit in income statement for the year (note 13a) (1,874) (1,186)
Net deferred tax liability at 31st December 5,464 4,772
82 ANNUAL REPORT AND ACCOUNTS 2012