8 Tax

Click icon to see this table in Excel format
Tax Charged to the Long-term Business Technical Account and the Non-technical Account		Attributable to long-term funds		Attributable to shareholders’ profits
		1998 £m	1997 £m	1998 £m	1997 £m
UK corporation tax		301	139	29	16
Double tax relief		(11)	(11)	(3)	(10)
Tax on franked investment income		166	155	3	2
Overseas tax		159	207*	3	82*
Prior year adjustments		(3)	53	(1)	(23)
		612	543*	31	67*
Deferred tax		74	31	3	25
		686	574*	34	92*
Tax credit attributable to balance on the long-term business technical account		–	–	227	240*
Total		686	574*	261	332
Analysed between:
	Tax on operating profit	–	–	214	246*
	Tax on short-term fluctuations in investment gains	–	–	9	33*
	Tax on profit on business disposals	–	–	38	–
	Tax on reclassification of shareholders’ reserves of Australian operation	–	–	–	53
Total		–	–	261	332

*Restated for altered basis of recognition of investment returns as explained in note 3.

Click icon to see this table in Excel format
	Liability provided (asset recognised)		Liability not provided (asset not recognised)
Deferred tax	1998 £m	1997 £m	1998 £m	1997 £m
Deferred acquisition costs	319	343	–	–
Short-term timing differences	(255)	(196)	(91)	(94)
Long-term business reserves	–	–	97	88
General insurance technical provisions	–	–	–	(10)
Capital allowances	(1)	(1)	(3)	(2)
Closure cost provisions	(11)	(4)	–	–
Unrealised gains on investments	413	307	2,685	2,203
Total	465	449	2,688	2,185

The principal reconciling item between the movement during 1998 on the balance sheet provision for deferred tax, and the charge for deferred tax included in the profit and loss account, is the release of provisions held by the Group’s Australasian operations which were sold in the year.