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Income tax expense (Tables) | 12 Months Ended
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Jun. 30, 2020
Text block [abstract] |
Summary of Income Tax Expense |
|  | 2020 |  |  | 2019 |  |  | 2018 |
|  | US$M |  |  | US$M |  |  | US$M |
Total taxation expense comprises: |  |  |  |  |  |  |  |  |  |  |  |
Current tax expense |  |  | 5,109 |  |  |  | 5,408 |  |  |  | 5,052 |
Deferred tax (benefit)/expense |  |  | (335 | ) |  |  | 121 |  |  |  | 1,955 |
|  |  | 4,774 |  |  |  | 5,529 |  |  |  | 7,007 |
Summary of Factors Affecting Income Tax Expense |
|  | 2020 |  |  | 2019 |  |  | 2018 |
|  | US$M |  |  | US$M |  |  | US$M |
Factors affecting income tax expense for the year |  |  |  |  |  |  |  |  |  |  |  |
Income tax expense differs to the standard rate of corporation tax as follows: |  |  |  |  |  |  |  |  |  |  |  |
Profit before taxation |  |  | 13,510 |  |  |  | 15,049 |  |  |  | 14,751 |
Tax on profit at Australian prima facie tax rate of 30 per cent |  |  | 4,053 |  |  |  | 4,515 |  |  |  | 4,425 |
Impact of US tax reform |  |  |  |  |  |  |  |  |  |  |  |
Tax rate changes |  |  | – |  |  |  | – |  |  |  | 1,390 |
Non-tax effected operating losses and capital gains |  |  | – |  |  |  | – |  |  |  | 834 |
Tax on remitted and unremitted foreign earnings (1) |  |  | – |  |  |  | – |  |  |  | 194 |
Recognition of previously unrecognised tax assets |  |  | – |  |  |  | – |  |  |  | (95 | )
Other |  |  | – |  |  |  | – |  |  |  | (3 | )
Subtotal |  |  | – |  |  |  | – |  |  |  | 2,320 |
Other items not related to US tax reform |  |  |  |  |  |  |  |  |  |  |  |
Non-tax effected operating losses and capital gains |  |  | 707 |  |  |  | 742 |  |  |  | 721 |
Tax on remitted and unremitted foreign earnings |  |  | 225 |  |  |  | 283 |  |  |  | 401 |
Tax effect of (loss)/profit from equity accounted investments, related impairments and expenses (2) |  |  | 154 |  |  |  | 164 |  |  |  | (44 | )
Amounts under/(over) provided in prior years |  |  | 64 |  |  |  | (21 | ) |  |  | (51 | )
Foreign exchange adjustments |  |  | 20 |  |  |  | (25 | ) |  |  | (152 | )
Tax rate changes |  |  | (8 | ) |  |  | 6 |  |  |  | (79 | )
Recognition of previously unrecognised tax assets |  |  | (30 | ) |  |  | (10 | ) |  |  | (170 | )
Investment and development allowance |  |  | (99 | ) |  |  | (94 | ) |  |  | (180 | )
Impact of tax rates applicable outside of Australia (3) |  |  | (167 | ) |  |  | (312 | ) |  |  | (484 | )
Other |  |  | (211 | ) |  |  | 87 |  |  |  | 172 |
Income tax expense |  |  | 4,708 |  |  |  | 5,335 |  |  |  | 6,879 |
Royalty-related taxation (net of income tax benefit) |  |  | 66 |  |  |  | 194 |  |  |  | 128 |
Total taxation expense |  |  | 4,774 |  |  |  | 5,529 |  |  |  | 7,007 |
(1) | Comprising US$797 million repatriation tax net of US$603 million of previously unrecognised tax credits.
(2) | The (loss)/profit from equity accounted investments, related impairments and expenses is net of income tax. This item removes the prima facie tax effect on such (loss)/profit, related impairments and expenses.
(3) | All profits earned in Singapore by BHP’s Sales and Marketing organisation from the sale of our Australian commodities acquired from entities controlled by BHP Group Limited are subject to Australian ‘top up tax’ under the Controlled Foreign Company tax rules in FY2020. This reflects the change in ownership of the main Sales and Marketing entity, in accordance with the settlement agreement entered into with the Australian Taxation Office in FY2019 to resolve a long-standing transfer pricing dispute.
Summary of Income Tax Recognised in Other Comprehensive Income | Income tax recognised in other comprehensive income is as follows:
|  | 2020 |  |  | 2019 |  |  | 2018 |
|  | US$M |  |  | US$M |  |  | US$M |
Income tax effect of: |  |  |  |  |  |  |  |  |  |  |  |
Items that may be reclassified subsequently to the income statement: |  |  |  |  |  |  |  |  |  |  |  |
Net valuation gains on investments taken to equity |  |  | – |  |  |  | – |  |  |  | (3 | )
Cash flow hedges: |  |  |  |  |  |  |  |  |  |  |  |
Gains/(losses) taken to equity |  |  | 94 |  |  |  | 98 |  |  |  | (25 | )
(Gains)/losses transferred to the income statement |  |  | (89 | ) |  |  | (90 | ) |  |  | 64 |
Income tax credit relating to items that may be reclassified subsequently to the income statement |  |  | 5 |  |  |  | 8 |  |  |  | 36 |
Items that will not be reclassified to the income statement: |  |  |  |  |  |  |  |  |  |  |  |
Remeasurement gains/(losses) on pension and medical schemes |  |  | 25 |  |  |  | 7 |  |  |  | (22 | )
Others |  |  | 1 |  |  |  | 12 |  |  |  | 8 |
Income tax credit/(charge) relating to items that will not be reclassified to the income statement |  |  | 26 |  |  |  | 19 |  |  |  | (14 | )
Total income tax credit relating to components of other comprehensive income (1) |  |  | 31 |  |  |  | 27 |  |  |  | 22 |
(1) | Included within total income tax relating to components of other comprehensive income is US$31 million relating to deferred taxes and US$ nil relating to current taxes (2019: US$15 million and US$12 million; 2018: US$17 million and US$5 million).

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- Definition The disclosure of income tax expense benefits. + References No definition available. + Details
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- Definition Disclosure of income tax relating to components of other comprehensive income. + References No definition available. + Details
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- Definition This is a reconciliation between tax that would have been paid at the Australian tax rate of 30% and the actual tax charge for the period. + References No definition available. + Details
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