Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of Income From Continuing Operations Before Income Tax

Income before income tax and the provision for income tax consist of the following (in millions):

	Years Ended December 31
	2023		2022		2021
Income (loss) before income taxes:
Ireland	$	31	$	85	$	15
U.K.	338		502		549
U.S.	219		161		(818)
Other	2,581		2,408		2,185
Total	$	3,169	$	3,156	$	1,931
Income tax expense:
Current:
Ireland	$	4	$	2	$	2
U.K.	185		206		50
U.S. federal	240		195		197
U.S. state and local	74		43		72
Other	411		316		291
Total current tax expense	$	914	$	762	$	612
Deferred tax expense (benefit):
Ireland	$	—	$	—	$	(1)
U.K.	(116)		(152)		131
U.S. federal	(126)		(69)		(83)
U.S. state and local	(39)		(21)		(30)
Other	(92)		(10)		(6)
Total deferred tax expense (benefit)	$	(373)	$	(252)	$	11
Total income tax expense	$	541	$	510	$	623

Schedule of Reconciliation of the Income Tax Provisions based on the U.S. Statutory Corporate Tax Rate to the Provisions Reflected in the Consolidated Financial Statements

	Years Ended December 31
	2023	2022	2021
Statutory tax rate	25.0%	25.0%	25.0%
U.S. state income taxes, net of U.S. federal benefit	0.6	0.4	1.5
Taxes on international operations (1)	(11.2)	(11.6)	(15.4)
Nondeductible expenses	3.2	2.4	3.3
Adjustments to prior year tax requirements	0.5	(7.0)	(0.2)
Deferred tax adjustments, including statutory rate changes	(0.3)	(0.5)	3.2
Deferred tax adjustments, international earnings	0.7	0.2	1.8
Adjustments to valuation allowances	(2.5)	1.9	(0.2)
Change in uncertain tax positions	2.6	8.6	2.1
Excess tax benefits related to shared based compensation (2)	(1.6)	(1.5)	(2.4)
Capital and other losses	—	(1.4)	—
Non-deductible transaction costs	—	—	1.1
Non-deductible termination fee	—	—	12.9
Other — net	0.1	(0.3)	(0.4)
Effective tax rate	17.1%	16.2%	32.3%

(1)The Company determines the adjustment for taxes on international operations based on the difference between the statutory tax rate applicable to earnings in each foreign jurisdiction and the enacted rate of 25.0%, 25.0% and 25.0% at December 31, 2023, 2022, and 2021, respectively. The benefit to the Company’s effective income tax rate from taxes on international operations relates to benefits from lower-taxed global operations, primarily due to the use of global funding structures and the tax holiday in Singapore.

(2)Excess tax benefits and deficiencies from share-based payment transactions are recognized as income tax expense or benefit in the Company’s Consolidated Statements of Income.

Schedule of Components of Aon's Deferred Tax Assets and Liabilities

The components of the Company’s deferred tax assets and liabilities are as follows (in millions):

As of December 31	2023		2022
Deferred tax assets:
Net operating loss, capital loss, interest, and tax credit carryforwards	$	1,049	$	952
Employee benefit plans	337		297
Lease liabilities	164		178
Other accrued expenses	155		100
Federal and state benefit of interest from uncertain tax positions	75		57
Accrued interest	52		—
Deferred revenue	25		26
Investment basis differences	49		30
Other (1)	40		39
Total	1,946		1,679
Valuation allowance on deferred tax assets	(197)		(275)
Total	$	1,749	$	1,404
Deferred tax liabilities:
Intangibles and property, plant and equipment	$	(254)	$	(258)
Deferred costs	(149)		(147)
Lease right-of-use asset	(135)		(151)
Unremitted earnings	(44)		(38)
Other accrued expenses	(20)		(20)
Unrealized foreign exchange gains	(18)		(23)
Other	(49)		(42)
Total	$	(669)	$	(679)
Net deferred tax asset	$	1,080	$	725

(1)$1 million of Lease and service guarantees reported for the year-ended Dec 31, 2022 have been reclassified into “Other”.

Schedule of Deferred Income Taxes (Assets and Liabilities Netted by Jurisdiction) as Classified in the Consolidated Statements of Financial Position

Deferred income taxes (assets and liabilities have been netted by jurisdiction) have been classified in the Consolidated Statements of Financial Position as follows (in millions):

As of December 31	2023		2022
Deferred tax assets — non-current	$	1,195	$	824
Deferred tax liabilities — non-current	(115)		(99)
Net deferred tax asset	$	1,080	$	725

Schedule of Operating and Capital Loss Carryforwards

The Company had the following carryforwards (in millions):

As of December 31	2023		2022
U.K.
Operating loss carryforwards	$	1,033	$	608
Capital loss carryforwards	$	550	$	533
U.S.
Federal operating loss carryforwards	$	1	$	1
Federal capital loss carryforwards	$	—	$	112
Federal interest carryforwards	$	2,303	$	2,269
Federal foreign tax credit carryforwards	$	24	$	20
State operating loss carryforwards	$	493	$	473
State capital loss carryforwards	$	—	$	123
State interest carryforwards	$	1,209	$	1,187
Other Non-U.S.
Operating loss carryforwards	$	461	$	490
Capital loss carryforwards	$	7	$	8
Interest carryforwards	$	129	$	26
Other carryforwards	$	3	$	5

Schedule of Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefits

The following is a reconciliation of the Company’s beginning and ending amount of uncertain tax positions (in millions):

	2023		2022
Balance at January 1	$	601	$	347
Additions based on tax positions related to the current year	40		35
Additions for tax positions of prior years	2		226
Reductions for tax positions of prior years	(3)		(1)
Settlements	—		(1)
Business combinations	—		—
Lapse of statute of limitations	(3)		(5)
Foreign currency translation	—		—
Balance at December 31	$	637	$	601