Eisai Co., Ltd. (“the Company”) and its affiliates (collectively referred to as “the Group”)
Fiscal year ended March 31, 2024
Notes to Consolidated financial statements (Income taxes)(1) Income taxes
Breakdown of income taxes(Unit: Millions of Yen)
Fiscal year ended
March 31, 2024

Fiscal year ended
March 31, 2023

Income taxes – current (Note 1)

14,502

13,282

Income taxes – deferred (Note 2)

3,537(25,106)

18,040(11,824)

Total(Note 1)

Movements of liabilities due to valuation of uncertain tax positions are included in “income taxes – current” ineach fiscal year.
(Note 2) For the fiscal year ended March 31, 2023, as part of the Group’s capital policy to optimize the global allocation ofcash in the Group, the Company received a repayment of paid-in capital of ¥63,622 million from its consolidated
U.S. subsidiary, Eisai Corporation of North America. As a result, the Company recognized losses on transferringof investments in subsidiaries for tax purposes and income taxes decreased by ¥21,588 million.
Reconciliation between the statutory tax rate and the effective income tax rate
The effective tax rate represents ratio of income taxes to profit before income taxes. The Company has been mainly
imposed corporate income taxes, resident taxes and business taxes, then the statutory tax rate based on these items
is 30.5%. Overseas subsidiaries have been imposed corporate income taxes in each jurisdiction.
(Unit: %)Fiscal year ended
March 31, 2024

Fiscal year ended
March 31, 2023

Statutory tax rate

30.5

30.5

Tax credit for experiment and research expenses

(2.7)

(4.1)

Tax rate differences in subsidiaries

(2.3)

(8.6)

Tax credit

(1.2)

(0.0)

Incomes taxes in the past

0.0

0.6

0.1

0.8

Uncertain tax positions

0.3

(1.0)

Valuation allowances

0.9

0.6

Size-based business tax (Added value component)

1.1

0.4

1.3

(0.3)

Repayment of paid-in capital from U.S. subsidiary－(48.0)Foreign tax deductible adjustment－

1.4

Others1.0

1.3

Effective tax rate

29.2

(26.3)

Withholdingtax

relatedwithdividends

fromsubsidiaries and others

Expenses not permanently deductible for income
tax purposes, such as entertainment expenses-1-(2) Deferred tax assets and deferred tax liabilities
Breakdown of deferred tax assets and deferred tax liabilities
The Group applies “Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendmentsto IAS 12)” from the fiscal year ended March 31, 2024 and represents amounts after applying retroactively.
For the fiscal year ended March 31, 2024
(Unit: Millions of Yen)
As ofApril 1, 2023

Recognizedthrough P&L

Recognizedthrough OCI

As ofMarch 31, 2024

Deferred tax assets
Entrusted R&D expenses

14,733352－15,08523,605

10,358－33,963Retirement benefit liabilities

3,223

2,705

(2,360)3,568

Depreciation and amortization

2,394

(194)

－

2,200

Accrued bonuses

4,160

174

－

4,334

Deferred charges for tax purposes

17,977(10,163)－

7,814

Unrealized gain on inventories

15,678(231)－

15,447

Net operating loss carryforward

30,340(2,627)－

27,713

Others19,179929－

20,108Sub-total

131,2901,303(2,360)130,232

Intangible assets

12,862(291)－

12,571

Depreciation and amortization

4,926

564

－

5,490

7,368

－

544

7,912

Others

4,205

(68)

－4,137

Sub-total

29,361205

544

30,110101,928

1,098(2,904)

100,122

Tax credit for experiment and researchexpenses

Deferred tax liabilities

Financial assets measured at fair value
through OCIBalance (Note 1)(Note 1)The difference between the balance recognized through P&L and income taxes – deferred is mainly due tomovements of liabilities due to valuation of uncertain tax positions which are offset with deferred tax assets inconsolidated statement of financial position and included in income taxes – current in consolidated statement ofincome, and movements of foreign currencies.

-2-For the fiscal year ended March 31, 2023
(Unit: Millions of Yen)
As ofApril 1, 2022

Recognizedthrough P&L

Recognizedthrough OCI

As ofMarch 31, 2023

Deferred tax assets
Entrusted R&D expenses

15,978(1,245)－

14,73328,784(5,179)－23,605Retirement benefit liabilities

3,866

(204)

(439)

3,223

Depreciation and amortization

2,501

(107)

－

2,394

Accrued bonuses

4,740

(580)

－

4,160

Deferred charges for tax purposes

9,480

8,497－17,977

Unrealized gain on inventories

16,431(753)－

15,678Net operating loss carryforward

2,462

27,878－30,340

Others

20,707(1,528)－19,179Sub-total

104,949

26,779(439)131,290

Intangible assets

14,116(1,254)－

12,862

Depreciation and amortization

4,900

26

－

4,926

5,819

－

1,549

7,368

Others

3,976

228

－

4,205

Sub-total

28,811

(999)

1,549

29,361

76,13827,778(1,988)

101,928

Tax credit for experiment and researchexpenses

Deferred tax liabilities

Financial assets measured at fair value
through OCIBalance (Note 1)(Note 1)The difference between the balance recognized through P&L and income taxes – deferred is mainly due tomovements of liabilities due to valuation of uncertain tax positions which are offset with deferred tax assets inconsolidated statement of financial position and included in income taxes – current in consolidated statement ofincome, and movements of foreign currencies.

Deferred tax assets and deferred tax liabilities(Unit: Millions of Yen)
As of March 31, 2024
Deferred tax assets
Deferred tax liabilities
Balance-3-

As of March 31, 2023

100,826

102,592704

664

100,122

101,928

(3) Deferred tax assets not recognized in the consolidated financial statements
The Group does not recognize deferred tax assets when it is not likely to arise sufficient taxable income in the future
period to utilize the benefit.
Breakdown of deferred tax assets not recognized in the consolidated financial statements(Unit: Millions of Yen)
As of March 31, 2024
Deductible temporary difference

5,552

4,326

Net operating loss carryforward (Note 1)

12,924

13,619Tax credit carryforward (Note 2)

6,4405,506

24,91623,451

Total(Note 1)

As of March 31, 2023

Breakdown by timing of expiration of net operating loss carryforward on which deferred tax assets are notrecognized in the consolidated statements(Unit: Millions of Yen)
As of March 31, 2024

As of March 31, 2023

Within one year－－

Over one year, within five years

－

1,703

12,924

11,915

12,924

13,619Over five years
Total(Note 2)

Breakdown by timing of expiration of tax credit carryforward on which deferred tax assets are not recognized inthe consolidated statements(Unit: Millions of Yen)
As of March 31, 2024

As of March 31, 2023

Within one year－－Over one year, within five years

－－

6,440

5,506

6,440

5,506

Over five years
Total-4-(4) Temporary differences regarding investments in subsidiaries on which deferred tax liabilities are not recognized in
the consolidated statement
For the fiscal year ended March 31, 2024, the amount of temporary differences regarding investments in subsidiaries
on which deferred tax liabilities are not recognized in the consolidated statements is ¥625,059 million (¥523,581 million
for the fiscal year ended March 31, 2023). The Group does not recognize deferred tax liabilities on the temporary
differences when the Company can control the timing of dissolution of the temporary differences and it is likely not tobe dissolved within foreseeable period.
(5) Global minimum tax
On March 28, 2023, the "Act for Partial Revision of the Income Tax Act, etc." (Act No. 3 of 2023) was enacted inJapan, to introduce a global minimum tax system based on the Pillar Two model rules. The Act is effective for theCompany on or after the fiscal year beginning April 1, 2024. The Company evaluated the potential impact of theapplication of the global minimum tax system based on the most recent Country-by-Country Reports and financialstatements of the constituent entities subject to the system, and have concluded that the impact on our consolidated
financial statements is not material, although there is a possibility of top-up taxation on the Company until the tax
burden in the countries where some subsidiaries are located reaches the 15% Minimum tax rate. The Group applies
the exception to recognizing and disclosing information about deferred tax assets and deferred tax liabilities related toincome taxes arising from tax law enacted or substantively enacted to implement the Pillar Two model rules.

-5-