6 Income taxes

Income tax expense is recognised based on management’s best estimate of the full year effective tax rate based on estimated full year profits. The estimated full year effective tax rate for the year to 28 January 2012 is 25.9% (the estimated tax rate for the period to 31 July 2010 was 32.5%). The decrease on last year is mainly because of the reduction in the main rate of corporation tax for the year to 28 January 2012 and the impact of substantially enacted changes to the main rate of corporation tax on deferred tax balances.

7 Capital expenditure

Property, plant and equipment £m Intangible assets £m

Net book values at 29 January 2011 3,622.6 111.4

Additions 208.9 44.9

Disposals – –

Depreciation and amortisation (121.2) (14.9)

Net book values at 30 July 2011 (3,710.3) 141.4

Property, plant and equipment additions include £116.7m in respect of store acquisitions and development in Waitrose and £52.6m in respect of store development in John Lewis.

Intangible assets additions primarily relate to internally developed IT systems.