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Income Taxes (Tables)

12 Months Ended

Sep. 30, 2022

Income Tax Disclosure [Abstract]

Provision (benefit) for Income Taxes

The provision (benefit) for income taxes consists of the following:

		Year Ended September 30,
		2022				2021				2020
Current		$	102,197			$	176,537			$	55,243
Deferred			(3,292	)			(50,605	)			30,239
Income taxes		$	98,905			$	125,932			$	85,482

Components of Deferred Tax Assets and Liabilities

Deferred income taxes are comprised of the following components:

		As of September 30,
		2022				2021
Deferred tax assets:
Deferred revenue		$	18,470			$	25,282
Employee compensation and benefits			90,445				76,020
Intangible assets, computer software and intellectual property			64,719				75,200
Tax credits, net capital and operating loss carryforwards			110,764				156,209
Lease liabilities			44,443				50,780
Other			48,171				46,372
Total deferred tax assets			377,012				429,863
Valuation allowances			(56,868	)			(65,550	)
Total deferred tax assets, net			320,144				364,313
Deferred tax liabilities:
Anticipated withholdings on subsidiaries’ earnings			(57,566	)			(84,755	)
Intangible assets, computer software and intellectual property			(109,419	)			(109,526	)
Lease assets			(38,454	)			(47,822	)
Other			(73,166	)			(97,638	)
Total deferred tax liabilities			(278,605	)			(339,741	)
Net deferred tax assets (liabilities)		$	41,539			$	24,572

Effective Income Tax Rate Varied from Statutory Guernsey Tax Rate

The effective income tax rate varied from the statutory Guernsey tax rate as follows:

		Year Ended September 30,
		2022				2021				2020
Statutory Guernsey tax rate			0	%			0	%			0	%
Foreign taxes(1)			15.3				15.5				14.7
Effective income tax rate			15.3	%			15.5	%			14.7	%

As a Guernsey company subject to a corporate tax rate of zero percent, the Company’s overall effective tax rate is attributable to foreign taxes. The Company’s income before income tax expense is considered to be foreign income.

(1) Foreign taxes for the year ended Sep 30, 2022:

In fiscal year 2022, the Company recorded a tax benefit of $37,000 related to the release of accrued withholding taxes on unremitted earnings accumulated in Israel. The release of the accrued withholding taxes followed the Company’s funding decisions relating to the construction of its new Israeli campus; such funding decisions have also taken into consideration recent changes in Israeli law and the recent application of the Preferred Technological Enterprise regime to the company’s main Israeli operating subsidiary.

Foreign taxes in fiscal year 2022 also included a benefit of $8,871 relating to changes in tax regulations in certain jurisdiction, and an expense of $3,193 for the estimated additional tax charge as a result of the gain from sale of a business (see also Note 3).

Foreign taxes in fiscal year 2022 also included a total amount of releases, net of additions related to prior years, of gross unrecognized tax benefits of $4,757 relating to effectively settled arrangements with tax

authorities, changes in facts and circumstances resulting in a change in measurement of certain positions and expiration of the periods set forth in statutes of limitations in certain jurisdictions.

Foreign taxes in fiscal year 2022 also included an expense of $1,211 resulting from the creation of valuation allowances on deferred tax assets at certain of the Company’s subsidiaries, which will not likely be realized due to the Company’s projections of future taxable income.

(1) Foreign taxes for the year ended Sep 30, 2021:

In fiscal year 2021, foreign taxes included an expense of $39,596 for the estimated additional tax charge as a result of the gain from sale of a business, please see also Note 3.

Foreign taxes in fiscal year 2021 also included a benefit of $10,933 resulting from internal structural changes in certain jurisdictions in which the Company operates.

Foreign taxes in fiscal year 2021 also included a total amount of releases, net of additions related to prior years, of gross unrecognized tax benefits of $7,701 relating to effectively settled arrangements with tax authorities, changes in facts and circumstances resulting in a change in measurement of certain positions and expiration of the periods set forth in statutes of limitations in certain jurisdictions. The net release was offset by decrease in tax assets and as a result the net impact on income tax expense for fiscal year 2021 was not material.

Foreign taxes in fiscal year 2021 also included a benefit of $6,006 resulting from the release of valuation allowances on deferred tax assets at certain of the Company’s subsidiaries, which will, more likely than not, be realized due to the Company’s projections of future taxable income.

(1) Foreign taxes for the year ended Sep 30, 2020:

In fiscal year 2020, foreign taxes included a total amount of releases of gross unrecognized tax benefits of $47,582 relating to effectively settled arrangements with tax authorities, changes in facts and circumstances resulting in a change in measurement of certain positions and expiration of the periods set forth in statutes of limitations in certain jurisdictions. The majority of the release was offset by decrease in tax assets and increase in tax liabilities and as a result a net benefit of $14,971 was included within income tax expense for fiscal year 2020.

Foreign taxes in fiscal year 2020 also included a benefit of $15,438 resulting from the release of valuation allowances on deferred tax assets at certain of the Company’s subsidiaries, which will, more likely than not, be realized due to the Company’s projections of future taxable income.

On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) to provide certain relief as a result of the COVID-19 outbreak. Some of the key income tax-related provisions of the CARES Act include modification in the usage of net operating losses, interest deductions and payroll benefits. Furthermore, other governments have offered and may continue to offer support to companies who operate in those countries.

Aggregate Changes in Balance of Company's Gross Unrecognized Tax Benefits

The aggregate changes in the balance of the Company’s gross unrecognized tax benefits were as follows:

		Year Ended September 30,
		2022				2021				2020
Balance at beginning of fiscal year		$	195,196			$	168,186			$	169,322
Additions based on tax positions related to the current year			22,386				25,662				23,154
Additions for tax positions of prior years			8,359				23,849				23,292
Reductions for tax positions of prior years			(7,262	)			(7,467	)			(15,214	)
Settlements with tax authorities(1)			(1,344	)			(10,245	)			(29,400	)
Lapse of statute of limitations			(4,304	)			(4,789	)			(2,968	)
Balance at end of fiscal year		$	213,031			$	195,196			$	168,186

(1) The changes in the years ended September 30, 2021 and 2020 were $10,245 and $29,400 respectively, the majority of which were offset by income tax payments or changes in Tax receivables, Tax payables and deferred tax assets. 

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