HSBC 2004 Annual Report Download - page 261

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6 Profit on ordinary activities before tax
Profit on ordinary activities before tax is stated after:
2004 2003 2002
US$m US$m US$m
Income
Aggregate rentals receivable under
– finance leases and hire purchase contracts ................................................. 4,560 3,279 2,502
– operating leases .......................................................................................... 632 553 490
Income from listed investments ..................................................................... 5,073 4,276 4,361
Profits less losses on debt securities and equities dealing .............................. 87 294 19
Gains on disposal of investment securities .................................................... 528 396 405
Charges
Charges incurred with respect to subordinated liabilities .............................. 1,052 958 862
Finance charges in respect of finance leases and similar hire purchase
contracts .................................................................................................... 42 38 36
Hire of plant and machinery .......................................................................... 160 110 81
Rentals payable on premises held under operating leases .............................. 847 773 548
Gains on the disposal of investments and tangible fixed assets attracted a tax charge of US$160 million (2003:
US$84 million, 2002: US$86 million). Of the after-tax amount, US$28 million (2003: US$23 million, 2002:
US$23 million) is attributable to minority interests.
7 Tax on profit on ordinary activities
The charge for taxation comprises:
2004 2003 2002
US$m US$m US$m
Current taxation
United Kingdom corporation tax charge – current year ................................. 1,570 1,819 1,096
United Kingdom corporation tax charge – adjustment in respect of
prior years .................................................................................................. (132) (149) (68)
Relief for overseas taxation ............................................................................ (722) (1,123) (344)
1
716 547 684
Overseas taxation – current year .................................................................... 2,877 2,646 1,246
Overseas taxation – adjustment in respect of prior years ............................... (21) (56) (29)
Joint ventures ................................................................................................. 31(6)
Associates ...................................................................................................... 42 19 17
3,617 3,157 1,912
Deferred taxation
Origination and reversal of timing differences ............................................... 981 (5) 615
Effect of change in tax rate on opening asset ................................................. (15) (7) –
Adjustment in respect of previous periods ..................................................... (76) (25) 7
890 (37) 622
Total charge for taxation ................................................................................ 4,507 3,120 2,534
HSBC Holdings and subsidiaries tax charge ................................................. 4,462 3,100 2,523
Joint ventures tax charge ................................................................................ 31(6)
Associates tax charge ..................................................................................... 42 19 17
4,507 3,120 2,534
HSBC Holdings and its subsidiary undertakings in the United Kingdom provide for UK corporation tax at 30 per
cent (2003 and 2002: 30 per cent). Overseas tax includes Hong Kong profits tax of US$539 million (2003:
US$483 million, 2002: US$408 million). Subsidiary undertakings in Hong Kong provide for Hong Kong profits tax
at the rate of 17.5 per cent (2003: 17.5 per cent, 2002: 16 per cent) on the profits for the year assessable in Hong
Kong. Other overseas subsidiary undertakings and overseas branches provide for taxation at the appropriate rates in
the countries in which they operate.