James Hardie Industries plc Annual and transition report of foreign private issuers pursuant to Section 13 or 15(d)

Annual and transition report of foreign private issuers pursuant to Section 13 or 15(d)

Income Taxes (Tables)

Income Taxes (Tables)

12 Months Ended

Mar. 31, 2012

Components of income tax (expense) benefit


	Years Ended 31 March
(Millions of US dollars)	2012			2011			2010

Income (loss) from operations before income taxes:
Domestic¹	$	97.1		$	66.5		$	12.8
Foreign		54.0			30.1			(31.5	)

Total income (loss) before income taxes	$	151.1		$	96.6		$	(18.7	)

Income tax benefit (expense):
Current:
Domestic¹	$	(2.5	)	$	(15.6	)	$	0.6
Foreign		454.3			(447.4	)		(137.7	)

Current income tax benefit (expense)		451.8			(463.0	)		(137.1	)

Deferred:
Domestic¹		(4.2	)		(22.2	)		(0.9	)
Foreign		5.6			41.6			71.8

Deferred income tax benefit		1.4			19.4			70.9

Total income tax benefit (expense)	$	453.2		$	(443.6	)	$	(66.2	)

¹ Since JHI SE became an Irish parent holding company during fiscal year 2011, domestic represents both Ireland and The Netherlands for fiscal year 2011. For fiscal year 2010, domestic represents The Netherlands.

Reconciled tax at the statutory rate


	Years Ended 31 March
(Millions of US dollars)	2012			2011			2010

Income tax (expense) benefit at statutory tax rates		$ (28.4	)		$ (18.3	)		$ 8.3
US state income taxes, net of the federal benefit		(0.8	)		(1.7	)		(3.7	)
Asbestos – effect of foreign exchange		(1.9	)		(31.7	)		(66.4	)
Benefit from Dutch financial risk reserve regime		-			-			3.2
Expenses not deductible		(0.7	)		(4.0	)		(3.7	)
Non-assessable items		0.4			-			2.0
Income (losses) not available for carryforward		1.1			0.7			(0.6	)
Repatriation of foreign earnings		(0.1	)		(32.6	)		-
Change in reserves		1.0			(0.2	)		(2.2	)
Amortisation of intangibles		1.7			(5.9	)		-
Taxes on foreign income		2.6			(2.0	)		(1.6	)
State amended returns and audit		(0.5	)		-			(2.2	)
Tax assessment in dispute		478.4			(349.1	)		-
Other permanent items		0.4			1.2			0.7

Total income tax benefit (expense)	$	453.2		$	(443.6	)	$	(66.2	)

Effective tax rate		299.9%			-459.2%			354.0%

Deferred tax assets and liabilities


	31 March
(Millions of US dollars)	2012			2011

Deferred tax assets:
Asbestos liability	$	444.5		$	461.9
Other provisions and accruals		49.0			35.7
Net operating loss carryforwards		11.0			32.5
Capital loss carryforwards		34.5			34.3

Total deferred tax assets		539.0			564.4
Valuation allowance		(42.1	)		(43.1	)

Total deferred tax assets, net of valuation allowance		496.9			521.3

Deferred tax liabilities:
Depreciable and amortisable assets		(117.3	)		(114.9	)
Unremitted earnings		-			(32.6	)
Other		(8.6	)		(4.2	)

Total deferred tax liabilities		(125.9	)		(151.7	)

Net deferred tax assets	$	371.0		$	369.6

Reconciliation of unrecognised tax benefits and interest and penalties


(US$ millions)	Unrecognised tax benefits			Interest and Penalties
Balance at 31 March 2009	$	12.3		$	(16.0	)

Additions for tax positions of the current year		1.2			-
Additions (deletions) for tax positions of prior year		4.4			(4.1	)
Other reductions for the tax positions of prior periods		(10.2	)		(0.6	)
Foreign currency translation adjustment		—			(6.2	)


Balance at 31 March 2010	$	7.7		$	(26.9	)

Additions for tax positions of the current year		0.1			-
Additions for tax positions of prior year		153.3			195.8
Other reductions for the tax positions of prior periods		(0.4	)		(0.2	)
Foreign currency translation adjustment		24.8			27.6


Balance at 31 March 2011	$	185.5		$	196.3

Additions for tax positions of the current year		0.2			-
Additions for tax positions of prior year		-			6.1
Settlements paid during the current period		(184.4	)		(208.9	)
Other reductions for the tax positions of prior periods		(5.2	)		-
Foreign currency translation adjustment		6.5			7.4

Balance at 31 March 2012	$	2.6		$	0.9

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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