Barclays impact5 Jan 2018 09:35
Barclays expects positive impact from US tax reform
27th December 2017, 09:10
Barclays expects US tax reforms which have reduced federal corporate income tax to 21% to have a positive impact on the group's future US after tax earnings.
Barclays expects the measurement of its US deferred tax assets to reduce by c.�1bn as a result of the reduced tax rate and net of a c.�0.3bn increase to US DTAs, unrelated to the Act, due to a revaluation of Barclays Bank plc's US branch DTAs.
It said this aggregate reduction in the measurement of US DTAs was expected to result in an associated one-off charge of c.�1bn to group profit after tax, a c.20 basis point reduction to the Group CET1 ratio and a decrease of c.6 pence to TNAV per share.
It said these estimates were all calculated based on financial information as at 30 Sep and would be accounted for in the financial year ended December 2017.
It said: 'This reduction in the statutory US federal rate is expected to positively impact Barclays' future US after tax earnings.
'However, the ultimate impact is subject to the effect of other complex provisions in the Act (including the Base Erosion and Anti-Abuse Tax (BEAT)), which Barclays is currently reviewing, and it is possible that any impact of BEAT could significantly reduce the benefit of the reduction in the statutory US federal rate.