Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Components of Income Tax Expense (Recovery) Recognized

Income tax expenses (recovery) recognized in the Consolidated Statements of Income:



For the years ended December 31,	2017			2016
Current tax
Current year	$	608		$	659
Adjustments to prior year⁽¹⁾		(38	)		(228	)
		570			431
Deferred tax
Change related to temporary differences		(803	)		(235	)
Impact of U.S. Tax Reform		472			–
Income tax expense	$	239		$	196

⁽¹⁾	Adjustments relating to closure of multiple taxation years

Income tax expenses (recovery) recognized in Other Comprehensive Income (“OCI”):



For the years ended December 31,	2017		2016
Current income tax expense (recovery)	$	116	$	(72	)
Deferred income tax expense (recovery)		320		(25	)
Income tax expense (recovery)	$	436	$	(97	)

Income tax expenses (recovery) recognized directly in Equity:



For the years ended December 31,	2017			2016
Current income tax expense (recovery)	$	–		$	(2	)
Deferred income tax expense (recovery)		(2	)		(2	)
Income tax expense (recovery)	$	(2	)	$	(4	)

Summary of Reconciliation of Income Tax Expense

The effective income tax rate reflected in the Consolidated Statements of Income varies from the Canadian tax rate of 26.75 per cent for the year ended December 31, 2017 (2016 – 26.75 per cent) and the reasons are disclosed below.

Reconciliation of income tax expense



For the years ended December 31,	2017			2016
Income before income taxes	$	2,501		$	3,329
Income tax expense at Canadian statutory tax rate	$	669		$	890
Increase (decrease) in income taxes due to:
Tax-exempt investment income		(242	)		(229	)
Differences in tax rate on income not subject to tax in Canada		(551	)		(366	)
Recovery of unrecognized tax losses of prior years		–			(10	)
Adjustments to taxes related to prior years		(182	)		(206	)
Tax losses and temporary differences not recognized as deferred taxes		14			22
Impact of U.S. Tax Reform		472			–
Other differences		59			95
Income tax expense	$	239		$	196

Summary of Deferred Tax Assets and Liabilities

The following table presents the Company’s deferred tax assets and liabilities.



As at December, 31	2017			2016
Deferred tax assets	$	4,569		$	4,439
Deferred tax liabilities		(1,281	)		(1,359	)
Net deferred tax assets	$	3,288		$	3,080

Components of Deferred Tax Assets and Liabilties

The following table presents significant components of the Company’s deferred tax assets and liabilities.


As at December 31, 2017	Balance, January 1, 2017			Recognized in Income Statement			Recognized in Other Comprehensive Income			Recognized in Equity			Translation and Other			Balance, December 31, 2017
Loss carry forwards	$	942		$	(311	)	$	–		$	3		$	(38	)	$	596
Actuarial liabilities		9,366			(1,053	)		(17	)		–			(418	)		7,878
Pensions and post-employment benefits		352			(87	)		(54	)		–			(3	)		208
Tax credits		875			(369	)		–			–			(52	)		454
Accrued interest		17			(12	)		–			(3	)		(1	)		1
Real estate		(1,396	)		284			(9	)		–			59			(1,062	)
Securities and other investments		(6,064	)		2,172			(239	)		–			324			(3,807	)
Sale of investments		(163	)		58			–			–			–			(105	)
Goodwill and intangible assets		(1,059	)		197			–			–			37			(825	)
Other		210			(548	)		(1	)		2			287			(50	)
Total	$	3,080		$	331		$	(320)		$	2		$	195		$	3,288

As at December 31, 2016	Balance, January 1, 2016			Recognized in Income Statement			Recognized in Other Comprehensive Income			Recognized in Equity			Translation and Other			Balance, December 31, 2016
Loss carry forwards	$	1,493		$	(515	)	$	–		$	–		$	(36	)	$	942
Actuarial liabilities		9,448			244			(5	)		(116	)		(205	)		9,366
Pensions and post-employment benefits		329			100			(79	)		–			2			352
Tax credits		750			147			–			–			(22	)		875
Accrued interest		121			(100	)		–			–			(4	)		17
Real estate		(1,812	)		373			–			–			43			(1,396	)
Securities and other investments		(6,218	)		(243	)		113			112			172			(6,064	)
Sale of investments		(200	)		37			–			–			–			(163	)
Goodwill and intangible assets		(1,138	)		58			–			–			21			(1,059	)
Other		59			134			(4	)		6			15			210
Total	$	2,832		$	235		$	25		$	2		$	(14	)	$	3,080