XML 39 R13.htm IDEA: XBRL DOCUMENT
v3.20.1

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2019
Income Taxes [Abstract] |
Income Taxes |
7. | Income Taxes
Corporate Income Tax The major components of consolidated net deferred income tax assets and liabilities recognized in our consolidated statements of financial position as at December 31, 2019 and 2018 are as follows:
|  | 2019 |  |  | 2018 |
|  | (in million pesos) |
Net deferred income tax assets |  |  | 23,623 |  |  |  | 27,697 |
Net deferred income tax liabilities |  |  | 2,583 |  |  |  | 2,981 |
The components of our consolidated net deferred income tax assets and liabilities as at December 31, 2019 and 2018 are as follows:
|  | 2019 |  |  | 2018 |
|  | (in million pesos) |
Net deferred income tax assets: |  |  |  |  |  |  |  |
Unamortized past service pension costs |  |  | 5,846 |  |  |  | 5,252 |
Pension and other employee benefits |  |  | 4,886 |  |  |  | 4,296 |
Lease liabilities |  |  | 4,474 |  |  |  | — |
Customer list and trademark |  |  | 3,890 |  |  |  | 4,670 |
Accumulated provision for expected credit losses |  |  | 3,806 |  |  |  | 3,709 |
Unearned revenues |  |  | 2,108 |  |  |  | 1,776 |
Provision for other assets |  |  | 1,661 |  |  |  | 1,595 |
MCIT |  |  | 1,408 |  |  |  | 905 |
Accumulated provision for inventory obsolescence and write-down |  |  | 701 |  |  |  | 916 |
Unrealized foreign exchange losses |  |  | 580 |  |  |  | 1,092 |
NOLCO |  |  | 432 |  |  |  | 3,231 |
Fixed asset impairment/depreciation due to shortened life of property and equipment |  |  | 138 |  |  |  | 1,870 |
Derivative financial instruments |  |  | — |  |  |  | (58 | )
ROU assets |  |  | (4,081 | ) |  |  | — |
Others |  |  | (2,226 | ) |  |  | (1,557 | )
Total deferred income tax assets – net |  |  | 23,623 |  |  |  | 27,697 |
Net deferred income tax liabilities: |  |  |  |  |  |  |  |
Intangible assets and fair value adjustment on assets acquired – net of amortization |  |  | 1,964 |  |  |  | 2,175 |
Investment property |  |  | 278 |  |  |  | 277 |
Unrealized foreign exchange gains |  |  | 254 |  |  |  | 366 |
Undepreciated capitalized interest charges |  |  | — |  |  |  | 7 |
Others |  |  | 87 |  |  |  | 156 |
Total deferred income tax liabilities |  |  | 2,583 |  |  |  | 2,981 |
Changes in our consolidated net deferred income tax assets (liabilities) as at December 31, 2019 and 2018 are as follows:
|  | 2019 |  |  | 2018 |
|  | (in million pesos) |
Net deferred income tax assets – balances at beginning of the year |  |  | 27,697 |  |  |  | 30,466 |
Net deferred income tax liabilities – balances at beginning of the year |  |  | (2,981 | ) |  |  | (3,366 | )
Net balances at beginning of the year |  |  | 24,716 |  |  |  | 27,100 |
Movement charged directly to other comprehensive income |  |  | 2,673 |  |  |  | 591 |
Adjustments due to adoption of IFRS 16 |  |  | (83 | ) |  |  | — |
Provision for deferred income tax |  |  | (6,267 | ) |  |  | (1,375 | )
Excess MCIT deducted against RCIT due |  |  | — |  |  |  | (370 | )
Adjustments due to adoption of IFRS 15 |  |  | — |  |  |  | (1,166 | )
Others |  |  | 1 |  |  |  | (64 | )
Net balances at end of the year |  |  | 21,040 |  |  |  | 24,716 |
Net deferred income tax assets – balances at end of the year |  |  | 23,623 |  |  |  | 27,697 |
Net deferred income tax liabilities – balances at end of the year |  |  | (2,583 | ) |  |  | (2,981 | )
The analysis of our consolidated net deferred income tax assets as at December 31, 2019 and 2018 are as follows:
|  | 2019 |  |  | 2018 |
|  | (in million pesos) |
Deferred income tax assets: |  |  |  |  |  |  |  |
Deferred income tax assets to be recovered after 12 months |  |  | 18,111 |  |  |  | 25,163 |
Deferred income tax assets to be recovered within 12 months |  |  | 7,759 |  |  |  | 4,872 |
|  |  | 25,870 |  |  |  | 30,035 |
Deferred income tax liabilities: |  |  |  |  |  |  |  |
Deferred income tax liabilities to be settled after 12 months |  |  | (2,078 | ) |  |  | (1,992 | )
Deferred income tax liabilities to be settled within 12 months |  |  | (169 | ) |  |  | (346 | )
|  |  | (2,247 | ) |  |  | (2,338 | )
Net deferred income tax assets |  |  | 23,623 |  |  |  | 27,697 |
The analysis of our consolidated net deferred income tax liabilities as at December 31, 2019 and 2018 are as follows:
|  | 2019 |  |  | 2018 |
|  | (in million pesos) |
Deferred income tax liabilities: |  |  |  |  |  |  |  |
Deferred income tax liabilities to be settled after 12 months |  |  | (2,376 | ) |  |  | (2,743 | )
Deferred income tax liabilities to be settled within 12 months |  |  | (207 | ) |  |  | (238 | )
Net deferred income tax liabilities |  |  | (2,583 | ) |  |  | (2,981 | )
Provision for income tax for the years ended December 31, 2019, 2018 and 2017 consist of:
|  | 2019 |  |  | 2018 |  |  | 2017 |
|  | (in million pesos) |
Current |  |  | 3,283 |  |  |  | 2,467 |  |  |  | 3,841 |
Deferred (Note 3) |  |  | 6,267 |  |  |  | 1,375 |  |  |  | (2,738 | )
|  |  | 9,550 |  |  |  | 3,842 |  |  |  | 1,103 |
The reconciliation between the provision for income tax at the applicable statutory tax rate and the actual provision for corporate income tax for the years ended December 31, 2019, 2018 and 2017 are as follows:
|  | 2019 |  |  | 2018 |  |  | 2017 |
|  | (in million pesos) |
Provision for income tax at the applicable statutory tax rate |  |  | 9,701 |  |  |  | 6,845 |  |  |  | 4,371 |
Tax effects of: |  |  |  |  |  |  |  |  |  |  |  |
Nondeductible expenses |  |  | 907 |  |  |  | 1,235 |  |  |  | 784 |
Equity share in net losses (earnings) of associates and joint ventures |  |  | 460 |  |  |  | 26 |  |  |  | (872 | )
Loss (income) not subject to income tax |  |  | 154 |  |  |  | (1,827 | ) |  |  | (301 | )
Diffeence between Optical Standard Deduction, OSD, and itemized deductions |  |  | (251 | ) |  |  | (22 | ) |  |  | (22 | )
Income subject to final tax |  |  | (599 | ) |  |  | (297 | ) |  |  | (2,545 | )
Income subject to lower tax rate |  |  | (1,323 | ) |  |  | (750 | ) |  |  | (520 | )
Net movement in unrecognized deferred income tax assets and other adjustments |  |  | 501 |  |  |  | (1,368 | ) |  |  | 208 |
Actual provision for income tax |  |  | 9,550 |  |  |  | 3,842 |  |  |  | 1,103 |
The breakdown of our consolidated deductible temporary differences, carryforward benefits of unused tax credits from excess of MCIT over RCIT, and NOLCO (excluding those not recognized due to the adoption of the OSD method) for which no deferred income tax assets were recognized and the equivalent amount of unrecognized deferred income tax assets as at December 31, 2019 and 2018 are as follows:
|  | 2019 |  |  | 2018 |
|  | (in million pesos) |
NOLCO |  |  | 3,322 |  |  |  | 4,289 |
Accumulated provision for expected credit losses |  |  | 2,947 |  |  |  | 3,144 |
Fixed asset impairment |  |  | 1,146 |  |  |  | 1,148 |
Gain on disposal of asset |  |  | 105 |  |  |  | 106 |
Unearned revenues |  |  | 95 |  |  |  | 25 |
Unrealized foreign exchange losses |  |  | 45 |  |  |  | 49 |
MCIT |  |  | 27 |  |  |  | 27 |
Accumulated write-down of inventories to net realizable values |  |  | 11 |  |  |  | 11 |
Operating lease |  |  | 1 |  |  |  | — |
Pension and other employee benefits |  |  | — |  |  |  | 13 |
Provisions for other assets |  |  | (116 | ) |  |  | 1,881 |
|  |  | 7,583 |  |  |  | 10,693 |
Unrecognized deferred income tax assets |  |  | 2,294 |  |  |  | 3,227 |
DMPI recognized deferred income tax assets to the extent that it is probable that sufficient taxable income will be available to allow all or part of the deferred income tax assets to be utilized. Digitel’s unrecognized deferred income tax assets amounted to Php1,362 million and Php1,421 million as at December 31, 2019 and 2018, respectively. Our consolidated deferred income tax assets have been recorded to the extent that such consolidated deferred income tax assets are expected to be utilized against sufficient future taxable profit. Deferred income tax assets shown in the preceding table were not recognized as we believe that future taxable profit will not be sufficient to realize these deductible temporary differences and carryforward benefits of unused tax credits from excess of MCIT over RCIT, and NOLCO in the future. The breakdown of our consolidated excess MCIT and NOLCO as at December 31, 2019 are as follows:
Date Incurred |  | Expiry Date |  | MCIT |  |  | NOLCO |
|  |  |  |  |  |  | (in million pesos) |
December 31, 2017 |  | December 31, 2020 |  |  | 6 |  |  |  | 2,161 |
December 31, 2018 |  | December 31, 2021 |  |  | 725 |  |  |  | 2,396 |
December 31, 2019 |  | December 31, 2022 |  |  | 704 |  |  |  | 205 |
|  |  |  |  | 1,435 |  |  |  | 4,762 |
Consolidated tax benefits |  |  |  |  | 1,435 |  |  |  | 1,429 |
Consolidated unrecognized deferred income tax assets |  |  |  |  | (27 | ) |  |  | (997 | )
Consolidated recognized deferred income tax assets |  |  |  |  | 1,408 |  |  |  | 432 |
The excess MCIT totaling Php1,435 million as at December 31, 2019 can be deducted against future RCIT liability. The excess MCIT that was deducted against RCIT amounted to Php206 million, Php488 million and Php15 million for the years ended December 31, 2019, 2018 and 2017, respectively. The amount of expired portion of excess MCIT amounted to Php10 million, Php1 million and Php72 million for the years ended December 31, 2019, 2018 and 2017, respectively. NOLCO totaling Php4,762 million as at December 31, 2019 can be claimed as deduction against future taxable income. The NOLCO claimed as deduction against taxable income amounted to Php9,530 million, Php1,094 million and Php4,241 million for the years ended December 31, 2019, 2018 and 2017, respectively. The amount of expired NOLCO amounted to Php973 million, Php1,272 million and Php354 million for the years ended December 31, 2019, 2018 and 2017, respectively. Registration with Subic Bay Freeport Enterprise and Clark Special Economic Zone Enterprise SubicTel and ClarkTel are registered with Subic Bay Freeport Enterprise and Clark Special Economic Zone Enterprise, or Economic Zones, respectively, under R.A. 7227 otherwise known as the Bases Conversion and Development Act of 1992. As registrants, SubicTel and ClarkTel are entitled to all the rights, privileges and benefits established thereunder including tax and duty-free importation of capital equipment and a special income tax rate of 5% of gross income, as defined in R.A. 7227. Our consolidated income derived from non-registered activities within the Economic Zones is subject to the RCIT rate at the end of the reporting period.

X
- Definition The entire disclosure for income taxes. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Name IAS -Number 12 -IssueDate 2019-01-01 -Section Disclosure -URI http://eifrs.ifrs.org/eifrs/xifrs-link?type=IAS&num=12&code=ifrs-tx-2019-en-r&doctype=Standard&dita_xref=IAS12_g79-88_TI -URIDate 2019-03-27 + Details
Name: | ifrs-full_DisclosureOfIncomeTaxExplanatory
Namespace Prefix: | ifrs-full_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Abstract for income taxes disclosure. + References No definition available. + Details
Name: | phi_IncomeTaxesAbstract
Namespace Prefix: | phi_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration