11 Tax on profit
The tax charge is based on the profit for the year and represents:
2017 £’000
2016 £’000
Current tax UK corporation tax on profit for the year at 19.25% (2016: 20.00%)
935
1,673
1
Adjustment in respect of prior years
2
Total current tax charge
936
1,675
Deferred tax (note 19) Origination and reversal of timing dierences
248
208
(2)
Rate changes
(185)
(94) 1,088
Adjustment in respect of prior years
(51)
Total tax charge for the year
1,647
The tax charge on the profit for the year is lower (2016: lower) than the standard rate of corporation tax in the UK of 19.25% (2016: 20.00%). The dierences are explained below. 2017 £’000 2016 £’000 Profit on ordinary activities before taxation 8,061 11,237 Profit for the year multiplied by 19.25% (2016: 20.00%) 1,552 2,247 Items not taxable for tax purposes (266) (362) Rate changes (2) (180) Accelerated capital allowances/timing dierences (65) (4) R&D Credit (38) – Adjustments in respect of prior years (93) (54) Total tax charge for the year 1,088 1,647 A reduction in the UK Corporation tax rate from 20% to 19% (eective 1 April 2016) and to 18% (eective 1 April 2020) and an additional reduction to 17% (eective 1 April 2020) was substantively enacted on 6 September 2016. This will reduce the company’s future current tax charge accordingly. The deferred tax asset at the balance sheet date has been calculated based on these rates. 12 Profit and loss account of parent company As permitted by Section 408 of the Companies Act 2006, the profit and loss account of the parent company is not presented as part of these financial statements. The parent company’s profit for the year was £3,881,000 (2016: profit £7,000).
The parent company’s profit for the year includes £4,000,000 (2016:£nil) of dividends received from subsidiary companies.
46 Financials | Whistl Annual Report 2017
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