INCOME TAXES

9 Months Ended

Jul. 04, 2021

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The effective tax rate for the three and nine month periods ended July 4, 2021 and June 28, 2020 was as follows:

	Three Month Periods Ended				Nine Month Periods Ended
Effective tax rate	July 4, 2021		June 28, 2020		July 4, 2021		June 28, 2020
SBH	43.6	%	28.0	%	30.2	%	46.4	%
SB/RH	43.3	%	30.3	%	30.2	%	285.4	%

The estimated annual effective tax rate applied to the three and nine month periods ended July 4, 2021 differs from the US federal statutory rate of 21% principally due to income earned outside the U.S. that is subject to U.S. tax, including the U.S. tax on global intangible low taxed income (“GILTI”), certain nondeductible expenses, foreign rates that differ from the US federal statutory rate, and state income taxes. The Company has U.S. net operating loss carryforwards, which do not allow it to take advantage of the foreign-derived intangible income (“FDII”) deduction. The Company’s federal effective tax rate on GILTI is therefore 21%.

During the three month period ended July 4, 2021, the Company recorded $7.6 million of deferred tax expense for the impact on net United Kingdom deferred tax liabilities from an increase in the United Kingdom’s future tax rate.

On November 20, 2020, the U.S. Treasury and the Internal Revenue Service issued Final Regulations (“Regulations”) under Internal Revenue Code Sections 245A and 951A related to the treatment of previously disqualified basis under the GILTI regime. The Regulations are effective for Fiscal 2022, but the Company can elect to apply them to Fiscal 2018 through Fiscal 2021. The Company expects to satisfy the requirements necessary to apply the Regulations retroactively and has therefore estimated and recorded a benefit of $5.3 million for the impact on years prior to Fiscal 2021 in the nine month period ended July 4, 2021. The Company also expects to apply the Regulations to Fiscal 2021 and has included the impact in the estimated annual effective tax rate.

As of July 4, 2021, and September 30, 2020, there was $32.4 million and $1.8 million of income taxes payable on the SB/RH Condensed Consolidated Statements of Financial Position, payable to its parent company, calculated as if SB/RH were a separate taxpayer.