We all know that budgets are stretched, but despite this our clients are still focusing hard on operational taxes. Now more than ever there is significant push/pull to get it right. Interested parties include investors, regulators, accounting authorities, tax authorities and directors.
Taking each in turn:
- Investors are demanding fund performance and tax compliance;
- Regulatory authorities (via Mifid II) are setting increased disclosures for transaction taxes;
- The FRC is pushing for greater disclosure in uncertain tax positions (via IFRIC 23);
- HMRC has recently introduced criminal sanctions for corporate tax avoidance (via the new criminal corporate offence); and
- Directors are increasingly becoming aware of the performance and reputation risk associated with tax.