XML 89 R22.htm IDEA: XBRL DOCUMENT
v2.4.1.9

Taxation | 12 Months Ended
--- | ---
Dec. 31, 2014
Income Tax Disclosure [Abstract] |
Taxation | TAXATION Under current Bermuda law, RenaissanceRe and its Bermuda subsidiaries are not subject to any income or capital gains taxes. In the event that such taxes are imposed, RenaissanceRe and its Bermuda subsidiaries would be exempted from any such tax until March 2035 pursuant to the Bermuda Exempted Undertakings Tax Protection Act 1966, and Amended Acts of 1987 and 2011, respectively. RenRe North America Holdings Inc. (“RenRe North America”) and its subsidiaries are subject to income taxes imposed by U.S. federal and state authorities and file a consolidated U.S. federal income tax return. Should the U.S. subsidiaries pay a dividend to RenaissanceRe, withholding taxes would apply to the extent of current year or accumulated earnings and profits. The Company also has operations in Ireland, the U.K., and Singapore which are subject to income taxes imposed by the respective jurisdictions in which they operate. The Company is not subject to income taxation other than as stated above. There can be no assurance that there will not be changes in applicable laws, regulations or treaties, which might require the Company to change the way it operates or become subject to taxation. The following is a summary of the Company’s income from continuing operations before taxes allocated between domestic and foreign operations:
| Year ended December 31, | 2014 |  | 2013 |  | 2012 |
| Domestic |  |  |  |  |  |
| Bermuda | $ | 701,476 |  |  | $ | 873,103 |  |  | $ | 795,378 |  |
| Foreign |  |  |  |  |  |
| United Kingdom | (3,166 | ) |  | (12,678 | ) |  | (15,404 | ) |
| U.S. | (10,977 | ) |  | (20,019 | ) |  | (16,467 | ) |
| Ireland | 1,549 |  |  | 1,855 |  |  | 3,318 |  |
| Singapore | (2,018 | ) |  | (1,223 | ) |  | 13 |  |
| Income from continuing operations before taxes | $ | 686,864 |  |  | $ | 841,038 |  |  | $ | 766,838 |  |
Income tax (expense) benefit is comprised as follows:
| Year ended December 31, 2014 | Current |  | Deferred |  | Total |
| Total income tax (expense) benefit | $ | (699 | ) |  | $ | 91 |  |  | $ | (608 | ) |
| Year ended December 31, 2013 |  |  |  |  |  |
| Total income tax (expense) benefit | $ | (2,005 | ) |  | $ | 313 |  |  | $ | (1,692 | ) |
| Year ended December 31, 2012 |  |  |  |  |  |
| Total income tax (expense) benefit | $ | (1,667 | ) |  | $ | 254 |  |  | $ | (1,413 | ) |
The Company’s expected income tax provision computed on pre-tax income at the weighted average tax rate has been calculated as the sum of the pre-tax income in each jurisdiction multiplied by that jurisdiction’s applicable statutory tax rate. Statutory tax rates of 0.0%, 35.0%, 12.5%, 21.5% and 17.0% have been used for Bermuda, the U.S., Ireland, the U.K. and Singapore, respectively. The Company’s effective income tax rate, which it calculates as income tax expense divided by net income before taxes, may fluctuate significantly from period to period depending on the geographic distribution of pre-tax net income in any given period between different jurisdictions with comparatively higher tax rates and those with comparatively lower tax rates. The geographic distribution of pre-tax income (loss) can vary significantly between periods due to, but not limited to, the following factors: the business mix of net premiums written and earned; the geographic location, the size and the nature of net claims and claim expenses incurred; the amount and geographic location of operating expenses, net investment income, net realized and unrealized gains (losses) on investments; outstanding debt and related interest expense; and the amount of specific adjustments to determine the income tax basis in each of the Company’s operating jurisdictions. In addition, a significant portion of the Company’s gross and net premiums are currently written and earned in Bermuda, which does not have a corporate income tax, including the majority of the Company’s catastrophe business, which can result in significant volatility to its pre-tax income (loss) in any given period. A reconciliation of the difference between the provision for income taxes and the expected tax provision at the weighted average tax rate is as follows:
| Year ended December 31, | 2014 |  | 2013 |  | 2012 |
| Expected income tax benefit | $ | 4,725 |  |  | $ | 9,930 |  |  | $ | 8,889 |  |
| Change in valuation allowance | (5,554 | ) |  | (8,574 | ) |  | (6,212 | ) |
| Other | 221 |  |  | (3,048 | ) |  | (4,090 | ) |
| Income tax expense | $ | (608 | ) |  | $ | (1,692 | ) |  | $ | (1,413 | ) |
The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below:
| At December 31, | 2014 |  | 2013 |
| Deferred tax assets |  |  |  |
| Tax loss and credit carryforwards | $ | 37,933 |  |  | $ | 34,429 |  |
| Deferred interest expense | 17,066 |  |  | 12,608 |  |
| Accrued expenses | 3,413 |  |  | 1,096 |  |
| Amortization and depreciation | 1,686 |  |  | 1,730 |  |
| Deferred underwriting results | 1,586 |  |  | 1,873 |  |
| Investments | 290 |  |  | 4,694 |  |
|  | 61,974 |  |  | 56,430 |  |
| Deferred tax liabilities |  |  |  |
| Amortization and depreciation | (54 | ) |  | (155 | ) |
|  | (54 | ) |  | (155 | ) |
| Net deferred tax asset before valuation allowance | 61,920 |  |  | 56,275 |  |
| Valuation allowance | (61,660 | ) |  | (56,106 | ) |
| Net deferred tax asset (liability) | $ | 260 |  |  | $ | 169 |  |
During 2014, the Company recorded a net increase to the valuation allowance of $5.6 million (2013 – increase of $21.0 million, 2012 – increase of $6.2 million). The Company’s net deferred tax asset primarily relates to net operating loss carryforwards and GAAP versus tax basis accounting differences relating to interest expense, underwriting results, accrued expenses and investments. The Company’s U.S. operations generated a cumulative GAAP taxable loss for the three year periods ended December 31, 2014 and 2013. Accordingly, the Company believes that it is more likely than not that the U.S. net deferred tax asset will not be realized and as a result has provided a full valuation allowance against its U.S. net deferred tax asset. In addition, a valuation allowance has been provided against deferred tax assets in Ireland, the U.K., and Singapore. These deferred tax assets relate primarily to net operating loss carryforwards and deferred underwriting results. In the U.S., the Company has net operating loss carryforwards of $65.0 million. Under applicable law, the U.S. net operating loss carryforwards will begin to expire in 2031. In Ireland, the Company has net operating loss carryforwards of $10.8 million. In the U.K., the Company has net operating loss carryforwards of $45.5 million. In Singapore, the Company has net operating loss carryforwards of $3.9 million. Under applicable law, the Irish, U.K. and Singapore net operating losses can be carried forward for an indefinite period. The Company had a net payment for U.S. federal, Irish, U.K. and Singapore income taxes of $1.1 million for the year ended 2014 (2013 – net payment of $1.2 million, 2012 – net refund of $13.2 million). The Company has unrecognized tax benefits of $Nil as of December 31, 2014 (2013 – $Nil). Interest and penalties related to unrecognized tax benefits would be recognized in income tax expense. At December 31, 2014, interest and penalties accrued on unrecognized tax benefits were $Nil. Income tax returns filed for tax years 2009 through 2013, 2010 through 2013, 2013 and 2012 through 2013, are open for examination by the Internal Revenue Service, Irish tax authorities, U.K. tax authorities, and Singapore tax authorities, respectively. The Company does not expect the resolution of these open years to have a significant impact on its results from operations and financial condition.

X
- Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration