1. Guiding Principles
It is the intention of the Group to comply with all tax legislation and to pay the correct amount of tax in each country in which it operates.
The Group will only enter into transactions and businesses for sound commercial reasons and will not arrange its affairs in order to avoid taxation.
This Strategy has been published in accordance with paragraph 16 of Schedule 19 to the Finance Act 2016.
2. Executive and Management Responsibility
The Chief Financial Officer (CFO) will be responsible for company tax matters, and will act as the Senior Accounting Officer (SAO). The CFO is able to delegate day-to-day responsibility to the Finance and tax team. The CFO will bring to the Board's attention all matters he considers appropriate, including (but not limited to):
2.1 The tax strategy;
2.2 Material disputes with tax authorities; and
2.3 Tax issues which have potentially material or reputational impacts.
The Finance department will maintain an in-house team (the “Tax Team”) with the necessary skills, experience and training to deal with the majority of UK tax matters arising.
3. Use of Consultants
The Group will use appropriately skilled external consultants where the CFO and Tax Team consider it necessary and appropriate. Assignments might involve complex compliance matters, advice relating to new business structuring, overseas tax matters and assistance where in-house tax resource is not available.
4. Tax Planning
The Group only undertakes any tax planning where appropriate for commercial transactions with third parties, and will not create artificial taxation structures.
The Group may participate in legitimate tax incentive schemes (for example tax credits for research and development activity, enhanced capital allowances for certain types of fixed assets) in line with, and in the spirit of, tax legislation.
5. Tax Compliance and Record Keeping
The Group will comply with all tax regulations and disclosure requirements in each country in which it operates.
The Group will:
5.1 Submit all tax returns by their due date;
5.2 Ensure tax returns are prepared by appropriate professionals (within the Group or outsourced) with due skill;
5.3 Ensure transactions and tax positions in tax returns are supported by appropriate documentation and expert opinion where appropriate;
5.4 Make all tax payments in accordance with local requirements;
5.5 Ensure arrangements are in place to enable the finance department to stay aware of changes in relevant tax law and regulations;
5.6 Maintain comprehensive and robust accounting records; and
5.7 Maintain and develop information systems to process and record transactions in compliance with tax requirements with a high level of data integrity and reliability.
6. Tax Risks and Uncertainty
The Group wishes to avoid disputes with tax authorities as far as reasonably possible, though recognises that on occasion, some arrangements may attract scrutiny and potentially be challenged by tax authorities.
The Group’s appetite for tax risk is determined by a desire to achieve certainty in its tax affairs.
The Group will:
6.1 Only enter into transactions or establish new companies with sound commercial purpose;
6.2 Maintain records and evidence in support of tax returns and positions; and
6.3 Endeavour to maintain good relations with tax authorities.
The Group will seek to avoid any risk of reputational damage when dealing with uncertainty.
The Group monitors relationships with contractors and reviews all agreements for compliance with IR35.
7. Monitoring and controls
The design and operational effectiveness of controls over tax compliance will be included within the scope of internal audit testing performed by external professional advisers reporting directly to the audit committee.
The tax risks will be reviewed on a regular basis and any significant matters brought to the attention of the Senior Accounting Officer (SAO) and the Board.
The SAO will actively discharge their responsibilities by ensuring that an effective control and review environment is in place and cascades up through management.
8. Supporting the business
The Tax Team will provide training, education and guidance as appropriate for the wider business to ensure that they are aware of the tax implications of their actions, and are able to discharge their responsibilities in a tax compliant manner.
The Tax Team will consult with the business on proposed new business opportunities to ensure that the tax impacts of such actions are fully captured and compliant.
9. Relationship with tax authorities
The Group wishes to maintain open and honest relationships with tax authorities within and outside the UK. The Group will maintain regular contact with the HMRC Corporate Compliance Manager, and provide regular updates in regard to business activity, systems and other pertinent information.
The Group will fully disclose all required information and deal with tax authority personnel in a professional, courteous and timely manner.
Where a transaction or structure may lead to challenge or alternative interpretation, the Group will engage with tax authorities as early as practicable in order to try to avoid dispute and uncertainty.
Publication date: 31/03/2020
This tax strategy is applicable from the date of publication and remains in place until superseded.
List of entities covered by this Tax Strategy:
- The Royal Mint Limited
- RM Experience Limited
- RM Assets Limited
- RM Wynt Limited