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Income Taxes
 3 Months Ended
Mar. 31, 2021
Income Tax Disclosure [Abstract]  
Income Taxes
NOTE 7 – INCOME TAXES
A roll-forward of unrecognized tax benefits and associated accrued interest and penalties is as follows:
 
(in millions)
   
Unrecognized
Tax Benefits
     
Interest and
Penalties
     
Total
  
Opening balance at January 1
    $ 13.6      $ 2.4      $ 16.0  
Net change for tax positions of prior periods
      (0.1 )       0.1        0.0  
    
 
 
     
 
 
     
 
 
  
Closing balance at March 31
      13.5        2.5        16.0  
Current
      0.0        0.0        0.0  
    
 
 
     
 
 
     
 
 
  
Non-current
    $ 13.5      $ 2.5      $ 16.0  
    
 
 
     
 
 
     
 
 
  
All of the $16.0 million of unrecognized tax benefits, interest and penalties would impact our effective tax rate if recognized.
As previously disclosed, a
non-U.S.
subsidiary, Innospec Performance Chemicals Italia Srl, is subject to an ongoing tax audit in relation to the period 2011 to 2014
inclusive. The C
ompany has determined additiona
l tax, interest and penalties totaling
$3.3 million may arise as a consequence of the tax audit. This includes a reduction for foreign exchange movements of $0.1 million recorded in the three months to March 31, 2021. As any additional tax arising as a consequence of the tax audit would be reimbursed by the previous owner under the terms of the sale and purchase agreement, an indemnification asset of the same amount is recorded in the financial statements to reflect this arrangement.
As previously disclosed, in 2018 the Company recorded an unrecognized tax benefit in relation to a potential adjustment that could arise as a consequence of the Tax Cuts and Jobs Act. The Company has determined that additional tax, interest and penalties totaling $12.5 million may arise in relation to this item. This includes an increase in interest accrued of $0.1 million in the three months to March 31, 2021.
Other non-significant items,
inclusive of interest and penalties, total $0.2 million.
The Company and its U.S. subsidiaries remain open to examination by the IRS for years 2017 onwards under the statute of limitations. The Company’s subsidiaries in foreign tax jurisdictions are open to examination including Germany (2016 onwards), Switzerland (2016 onwards), Spain (2016 onwards), France (2018 onwards) and the United Kingdom (2018 onwards).