A tax strategy is a document required to be published annually by businesses which operate in the United Kingdom with a turnover above £200m or a balance sheet above £2 billion.[1] This requirement is set out in Section 161 of the Finance Act 2016.[2] A group of companies may produce a "group tax strategy".[3]
Components
editA company's tax strategy must set out:
(a) the company's approach to risk management and governance arrangements in relation to UK taxation,
(b) the company's attitude towards tax planning (so far as affecting UK taxation),
(c) the level of risk in relation to UK taxation that the company is prepared to accept,
(d) the company's approach towards its dealings with HMRC.[2]
A company meeting the turnover or balance sheet thresholds which fails to comply may be fined.
Accountants Ernst and Young estimate that over 2000 UK businesses are affected by this requirement.[4]
References
edit- ^ HMRC, Large businesses: publish your tax strategy, 24 June 2016, accessed 23 March 2018
- ^ a b Finance Act 2016, accessed 27 March 2018
- ^ Finance Act 2016, Schedule 19: Part 2
- ^ Tax strategy publication - are you ready? 2016, accessed 27 March 2018
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