Taxes (Tables)

12 Months Ended

Mar. 30, 2024

(Loss) Income Before Provision for Income Taxes

(Loss) income before (benefit) provision for income taxes consisted of the following (in millions):


	Fiscal Years Ended
	March 30, 2024		April 1, 2023		April 2, 2022
United States	$	(15)	$	85	$	247
Non-United States	(268)		563		668
Total (loss) income before (benefit) provision for income taxes	$	(283)	$	648	$	915

Provision for Income Taxes

The (benefit) provision for income taxes was as follows (in millions):


	Fiscal Years Ended
	March 30, 2024			April 1, 2023			April 2, 2022
Current
United States - Federal	$	14		$	62		$	36
United States - State	5			22			16
Non-United States	114		(1)	46		(3)	98
Total current provision for income taxes	133			130			150
Deferred
United States - Federal	(12)			(40)			24		(4)
United States - State	(5)			(6)			7
Non-United States	(170)		(2)	(55)			(89)		(5)
Total deferred provision for income taxes	(187)			(101)			(58)
Total (benefit) provision for income taxes	$	(54)		$	29		$	92

(1)Primarily relates to the UK tax restructuring activities in Fiscal 2024.

(2)Primarily relates to the impairment of Jimmy Choo and Versace indefinite-lived intangible assets in Fiscal 2024.

(3)Primarily relates to the remeasurement of an Asian income tax reserve.

(4)Relates to the impact of United States tax accounting method change filed during Fiscal 2022 with respect to cost capitalization.

(5)Primarily relates to a valuation allowance reversal in Italy during Fiscal 2022.

Significant Differences Between the Statutory Tax Rates and Company's Effective Tax Rate

The Company’s benefit for income taxes for the year ended March 30, 2024 and provision for income taxes for the years ended April 1, 2023 and April 2, 2022 were different from the amount computed by applying the statutory U.K. income tax rates to the underlying (Loss) income before (benefit) provision for income taxes as a result of the following (amounts in millions):


	Fiscal Years Ended
	March 30, 2024				April 1, 2023				April 2, 2022
	Amount		% (1)		Amount		% (1)		Amount		% (1)
(Benefit) provision for income taxes at the U.K. statutory tax rate (2)	$	(71)	25.0	%	$	123	19.0	%	174		19.0	%
Effects of global financing arrangements (3)	(28)		9.9	%	(78)		(12.1)	%	(61)		(6.7)	%
Differences in tax effects on foreign income	(25)		8.8	%	(1)		(0.2)	%	10		1.1	%
Liability for uncertain tax positions	(11)		3.9	%	(3)		(0.4)	%	91		9.9	%
Effect of changes in valuation allowances on deferred tax assets	(9)		3.1	%	(37)		(5.8)	%	(67)		(7.3)	%
Non-deductible goodwill impairment (4)	48		(17.0)	%	15		2.4	%	—		—	%
State and local income taxes, net of federal benefit	11		(3.9)	%	10		1.5	%	12		1.3	%
Share based compensation	15		(5.4)	%	6		0.9	%	3		0.4	%
Withholding tax	5		(1.6)	%	3		0.5	%	5		0.6	%
Merger related costs	4		(1.5)	%	—		—	%	—		—	%
Brand tax basis step-up	—		—	%	—		—	%	(46)		(5.0)	%
CARES Act tax loss carryback	—		—	%	—		—	%	(43)		(4.6)	%
Tax rate change impact on deferred items	—		—	%	—		—	%	21		2.1	%
Other	7		(2.3)	%	(9)		(1.3)	%	(7)		(0.7)	%
Effective tax rate	$	(54)	19.0	%	$	29	4.5	%	$	92	10.1	%

(1)Tax rates are calculated using unrounded numbers.

(2)The UK statutory tax rate increased from 19% to 25% on April 1, 2023.

(3)Includes the tax related impacts of hedge terminations in conjunction with global financing arrangements.

(4)Attributable to goodwill impairment charges related to Jimmy Choo reporting units in Fiscal 2024.

Significant Components of Deferred Tax Assets (Liabilities)

Significant components of the Company’s deferred tax assets (liabilities) consist of the following (in millions):


	Fiscal Years Ended
	March 30, 2024			April 1, 2023
Deferred tax assets
Operating lease liabilities	$	458		$	442
Net operating loss carryforwards	334			115
Accrued interest	108			70
Depreciation	47			61
Sales allowances	29			38
Inventories	23			21
Capitalized research and development	18			—
Stock compensation	4			6
Payroll related accruals	2			3
Other	18			29
Total deferred tax assets	1,041			785
Valuation allowance	(176)		(1)	(52)		(3)
Net deferred tax assets	865			733

Deferred tax liabilities
Goodwill and intangibles	(333)		(2)	(420)
Operating lease right-of-use-assets	(359)			(339)
Derivative financial instruments	(183)			(186)


Total deferred tax liabilities	(875)			(945)
Net deferred tax liabilities	$	(10)		$	(212)

(1)Includes an incremental Swiss valuation allowance recorded during Fiscal 2024.

(2)Includes the impact of the Jimmy Choo and Versace indefinite-lived intangible asset impairment recorded during Fiscal 2024.

(3)Includes a U.K. valuation allowance reversal during Fiscal 2023.

Reconciliation of Beginning and Ending Amounts of Unrecognized Tax Benefits Excluding Accrued Interest

A reconciliation of the beginning and ending amounts of unrecognized tax benefits, excluding accrued interest, for Fiscal 2024, Fiscal 2023 and Fiscal 2022, are presented below (in millions):


	Fiscal Years Ended
	March 30, 2024			April 1, 2023		April 2, 2022
Unrecognized tax benefits beginning balance	$	200		$	221	$	107
Additions related to prior period tax positions	16			12		105
Additions related to current period tax positions	6			14		29
Decreases related to audit settlements	(46)		(1)	(2)		(13)
Decreases related to prior period tax positions	(16)			(42)		(4)
Decreases in prior period positions due to lapses in statute of limitations	(3)			(3)		(3)
Unrecognized tax benefits ending balance	$	157		$	200	$	221

(1)This amount is primarily related to settlements of Italian transfer pricing and Hong Kong corporate income tax audits during Fiscal 2024.