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, 2014

Components of Income Tax Benefit (Expense)

Income tax benefit (expense) consists of the following components:


	Years Ended 31 March
(Millions of US dollars)	2014			2013			2012

Income from operations before income taxes:
Domestic	$	141.6		$	110.6		$	97.1
Foreign		(87.0	)		(76.9	)		54.0

Total income before income taxes	$	54.6		$	33.7		$	151.1

Income tax benefit (expense):
Current:
Domestic	$	(8.9	)	$	(5.3	)	$	(2.5	)
Foreign		44.6			(14.7	)		454.3

Current income tax benefit (expense)		35.7			(20.0	)		451.8

Deferred:
Domestic		(3.3	)		0.7			(4.2	)
Foreign		12.5			31.1			5.6

Deferred income tax benefit		9.2			31.8			1.4

Total income tax benefit	$	44.9		$	11.8		$	453.2

Reconciled Tax at Statutory Rates

Income tax benefit (expense) is reconciled to the tax at the statutory rates as follows:


	Years Ended 31 March
(Millions of US dollars)	2014			2013			2012
Income tax benefit (expense) at statutory tax rates	$	6.2		$	8.8		$	(28.4	)
US state income taxes, net of the federal benefit		(1.8	)		(0.1	)		(0.8	)
Asbestos - effect of foreign exchange		30.2			(0.3	)		(1.9	)
Expenses not deductible		(2.1	)		(2.0	)		(0.7	)
Non-assessable items		0.6			1.8			0.4
Repatriation of foreign earnings		-			2.7			(0.1	)
Amortisation of intangibles		1.7			2.0			1.7
Taxes on foreign income		(2.9	)		(1.6	)		2.6
Tax assessment in dispute		10.7			-			478.4
Other items		2.3			0.5			2.0

Total income tax benefit	$	44.9		$	11.8		$	453.2

Effective tax rate		(82.2%	)		(35.0%	)		(299.9%	)

Deferred Tax Assets and Liabilities

Deferred tax balances consist of the following components:


	31 March
(Millions of US dollars)	2014			2013
Deferred tax assets:
Asbestos liability	$	471.8		$	452.7
Other provisions and accruals		52.5			56.5
Net operating loss carryforwards		12.8			18.9
Foreign tax credit carryforwards		135.4			123.9
Capital loss carryforwards		-			34.5

Total deferred tax assets		672.5			686.5
Valuation allowance		(142.4	)		(165.1	)

Total deferred tax assets, net of valuation allowance		530.1			521.4

Deferred tax liabilities:
Depreciable and amortisable assets		(111.2	)		(110.8	)
Other		(6.9	)		(7.8	)

Total deferred tax liabilities		(118.1	)		(118.6	)

Net deferred tax assets	$	412.0		$	402.8

Reconciliation of Unrecognised Tax Benefits and Interest and Penalties

A reconciliation of the beginning and ending amount of unrecognised tax benefits and interest and penalties are as follows:


(US$ millions)	Unrecognised tax benefits			Interest and Penalties

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


Additions for tax positions of the current year		0.1			-
Additions for tax positions of prior year		2.6			(0.1	)
Expiration of statute of limitations		(2.8	)		(0.7	)
Other reductions for the tax positions of prior periods		(1.0	)		-


Balance at 31 March 2013	$	1.5		$	0.1


Additions for tax positions of the current year		0.1			-
Additions for tax positions of prior year		0.1			-
Settlements paid during the current period		(1.2	)		-
Other reductions for the tax positions of prior periods		-			(0.1	)


Balance at 31 March 2014	$	0.5		$	-

- 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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