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Notes
to the Group annual financial statements
continued
For the year ended 31 May 2017
BLUE LABEL
INTEGRATED ANNUAL REPORT 2017
7.
Taxation
continued
7.2 Deferred taxation continued
2017
R’000
2016
R’000
Deferred tax asset comprises:
Capital allowances
—
(817)
Provisions
(23 076)
(18 768)
Tax losses
(16 290)
(16 619)
Other
(5 262)
(3 184)
Total deferred tax asset
(44 628)
(39 388)
Deferred tax liability comprises:
Capital allowances
7 370
359
Fair value gains
36 304
41 715
Provisions
695
107
Prepayments
2 802
4 268
Unrealised foreign exchange differences
17 734
33 868
Other
5 978
—
Total deferred tax liability
70 883
80 317
Net deferred tax
26 255
40 929
The analysis of deferred tax assets and deferred tax liabilities is as follows:
Deferred tax assets
Deferred tax assets to be recovered after more than 12 months
10 396
1 713
Deferred tax assets to be recovered within 12 months
(37 093)
(22 925)
Net deferred tax asset
(26 697)
(21 212)
Deferred tax liabilities
Deferred tax liabilities to be recovered after more than 12 months
44 168
68 217
Deferred tax liabilities to be recovered within 12 months
8 784
(6 076)
Net deferred tax liability
52 952
62 141
Net deferred tax
26 255
40 929
Where deferred tax assets have been recognised in respect of entities which have incurred losses in the current or
prior years, a formal process of assessment of the future profitability of the entity has been performed based on
detailed budgets and cash flow forecasts. As a result, management believes that the current tax losses will be utilised
within one to five years.
Deferred tax assets are recognised for tax losses carried forward to the extent that the realisation of the related tax
benefit through future taxable profits is probable. The Group did not recognise deferred income tax assets of
R44.3 million (2016: R44.3 million) in respect of losses amounting to R158.5 million (2016: R158.2 million) that
can be carried forward against future taxable income.
There is no withholding tax that would be payable on any dividends received from the Group’s equity accounted
associates and joint ventures and therefore no deferred tax has been raised in this regard. Deferred tax at the CGT
rate has been raised on investments in associates and joint venture that are classified as venture capital investments.
2017
R’000
2016
R’000
7.3 Taxation paid
Balance outstanding at the beginning of the year
36 521
36 169
Taxation charge
345 990
305 420
Translation differences
—
50
Balance outstanding at the end of the year
(43 697)
(36 521)
338 814
305 118