Income Taxes (Tables)

12 Months Ended

Mar. 31, 2024

Major components of tax expense (income) [abstract]

Schedule of Income Tax Expense

Income tax expense in the consolidated statement of comprehensive income comprises:


		(Dollars in millions)
		Year ended March 31,
		2024				2023				2022
Current taxes
Domestic taxes			768				830				785
Foreign taxes			247				323				263
			1,015				1,153				1,048
Deferred taxes
Domestic taxes			180				54				48
Foreign taxes			(18	)			(65	)			(28	)
			162				(11	)			20
Income tax expense			1,177				1,142				1,068

Summary of Reconciliation of Income Tax Provision to Amount Computed by Applying Statutory Income Tax Rate to Income Before Income Taxes

A reconciliation of the income tax provision to the amount computed by applying the statutory income tax rate to the income before income taxes is summarized below:


		(Dollars in millions)
		Year ended March 31,
		2024				2023				2022
Profit before income taxes			4,346				4,125				4,036
Enacted tax rates in India			34.94	%			34.94	%			34.94	%
Computed expected tax expense			1,519				1,442				1,410
Tax effect due to non-taxable income for Indian tax purposes			(363	)			(362	)			(395	)
Overseas taxes			136				132				132
Tax provision (reversals)			(113	)			(13	)			(36	)
Effect of differential tax rates			(69	)			(41	)			(26	)
Effect of exempt non-operating income			(6	)			(6	)			(7	)
Effect of unrecognized deferred tax assets			25				14				10
Effect of non-deductible expenses			20				19				22
Impact of change in tax rate			—				—				(13	)
Others			28				(43	)			(29	)
Income tax expense			1,177				1,142				1,068

Summary of Expiration of Unused Tax Losses

The following table provides details of expiration of unused tax losses for fiscal 2024:


(Dollars in millions)
Year
2025			2
2026			24
2027			15
2028			56
2029			82
Thereafter			381
Total			560

The following table provides details of expiration of unused tax losses for fiscal 2023:


(Dollars in millions)
Year
2024			15
2025			17
2026			18
2027			10
2028			60
Thereafter			418
Total			538

Summary of Income Tax Assets and Income Tax Liabilities

The following table provides the details of income tax assets and income tax liabilities as of March 31, 2024, and March 31, 2023:


(Dollars in millions)
		As of
		March 31, 2024				March 31, 2023
Income tax assets			1,132			786
Current income tax liabilities			(430	)			(412	)
Net current income tax assets / (liabilities) at the end			702				374

The gross movement in the current income tax assets / (liabilities) for fiscal 2024, 2023 and 2022 is as follows:


		(Dollars in millions)
		Year ended March 31,
		2024				2023				2022
Net current income tax assets / (liabilities) at the beginning			374				468				501
Translation differences			(5	)			(32	)			(18	)
Income tax paid			1,114				1,088				1,020
Current income tax expense			(1,015	)			(1,153	)			(1,048	)
Interest receivable on income tax refund			234				—				—
Income tax on other comprehensive income			—				(2	)			2
Income tax benefit arising on exercise of stock options			—				6				10
Tax impact on buyback expenses			—				1				1
Additions through business combination			—				(2	)			—
Net current income tax assets / (liabilities) at the end			702				374				468

Summary of Movement in Gross Deferred Income Tax Assets / Liabilities

The movement in gross deferred income tax assets / liabilities (before set off) for fiscal 2024 is as follows:


																		(Dollars in millions)
		Carrying value as of April 1, 2023				Changes through profit and loss				Addition through business combination				Changes through OCI				Translation difference				Carrying value as of March 31, 2024
Deferred income tax assets / (liabilities)
Property, plant and equipment			21				9				—				—				(1	)			29
Lease liabilities			27				(3	)			—				—				—				24
Accrued compensation to employees			8				(1	)			—				—				—				7
Trade receivables			32				(5	)			—				—				—				27
Compensated absences			70				6				—				—				(1	)			75
Post sales client support			30				(23	)			—				—				—				7
Credits related to branch profits			87				10				—				—								97
Derivative financial instruments			—				(1	)			—				(1	)			—				(2	)
Intangibles			7				—				—				—				—				7
Intangibles arising on business combinations			(42	)			8				—				—				—				(34	)
Branch profit tax			(105	)			(24	)			—				—								(129	)
SEZ reinvestment reserve			(164	)			(78	)			—				—				3				(239	)
Interest receivable on income tax refund			—				(58	)			—				—				—				(58	)
Others			32				(2	)			—				(1	)			(1	)			28
Total Deferred income tax assets / (liabilities)			3				(162	)			—				(2	)			—				(161	)

The movement in gross deferred income tax assets / liabilities (before set off) for fiscal 2023 is as follows:


																		(Dollars in millions)
		Carrying value as of April 1, 2022				Changes through profit and loss				Addition through business combination				Changes through OCI				Translation difference				Carrying value as of March 31, 2023
Deferred income tax assets / (liabilities)
Property, plant and equipment			21				2				—				—				(2	)			21
Lease liabilities			24				6				—				—				(3	)			27
Accrued compensation to employees			7				2				—				—				(1	)			8
Trade receivables			28				6				—				—				(2	)			32
Compensated absences			70				6				—				—				(6	)			70
Post sales client support			17				14				—				—				(1	)			30
Credits related to branch profits			89				(2	)			—				—				—				87
Derivative financial instruments			(3	)			3				—				—				—				—
Intangibles			6				1				—				—				—				7
Intangibles arising on business combinations			(41	)			9				(10	)			—				—				(42	)
Branch profit tax			(110	)			5				—				—				—				(105	)
SEZ reinvestment reserve			(112	)			(62	)			—				—				10				(164	)
Others			11				21				—				—				—				32
Total Deferred income tax assets / (liabilities)			7				11				(10	)			—				(5	)			3

The movement in gross deferred income tax assets / liabilities (before set off) for fiscal 2022 is as follows:


																		(Dollars in millions)
		Carrying value as of April 1, 2021				Changes through profit and loss				Addition through business combination				Changes through OCI				Translation difference				Carrying value as of March 31, 2022
Deferred income tax assets / (liabilities)
Property, plant and equipment			35				(13	)			—				—				(1	)			21
Lease liabilities			23				2				—				—				(1	)			24
Accrued compensation to employees			6				2				—				—				(1	)			7
Trade receivables			30				(1	)			—				—				(1	)			28
Compensated absences			68				4				—				—				(2	)			70
Post sales client support			16				1				—				—				—				17
Credits related to branch profits			48				42				—				—				(1	)			89
Derivative financial instruments			(8	)			4				—				—				1				(3	)
Intangibles			4				2				—				—				—				6
Intangibles arising on business combinations			(50	)			8				—				—				1				(41	)
Branch profit tax			(68	)			(42	)			—				—				—				(110	)
SEZ reinvestment reserve			(84	)			(32	)			—				—				4				(112	)
Others			10				3				—				(2	)			—				11
Total Deferred income tax assets / (liabilities)			30				(20	)			—				(2	)			(1	)			7

The deferred income tax assets and liabilities is as follows:


		(Dollars in millions)
		As of
		March 31, 2024				March 31, 2023
Deferred income tax assets after set off		55				152
Deferred income tax liabilities after set off			(216	)			(149	)