Tax Strategy and Approach to Taxation

1. Foreword

Parker Russell (“the Firm”) is committed to maintaining the highest standards of integrity, professionalism, transparency and accountability in all aspects of its business operations, including the management of its tax affairs.

The Firm recognises that tax contributes significantly to the societies and economies in which we operate and that responsible tax conduct is an important component of good corporate governance and sustainable business practice.

This Tax Strategy outlines the principles, governance arrangements, risk management framework and operational controls that govern the Firm’s approach to taxation. It reflects our commitment to complying fully with both the letter and the spirit of tax legislation and maintaining constructive relationships with tax authorities.

This Strategy is approved by the Managing Partner and reviewed annually.

2. Purpose

The purpose of this Strategy is to:

• Establish a clear framework for managing tax matters.
• Define responsibilities and accountability for tax governance.
• Ensure compliance with all applicable tax legislation.
• Promote transparency and ethical conduct.
• Support effective tax risk management.
• Protect the Firm’s reputation and stakeholder confidence.
• Demonstrate responsible corporate citizenship.
• Support sustainable long-term growth.

The Firm seeks to ensure that tax considerations are integrated into business decision-making whilst remaining consistent with our ethical obligations and professional standards.

3. Legislative and Regulatory Framework

This Strategy is published in accordance with Schedule 19, Paragraph 16(2) of the Finance Act 2016.

The Firm seeks to comply with all applicable legislation, regulations and professional standards including:

Tax Legislation

• Finance Acts.
• Taxes Management Act 1970.
• Corporation Tax Acts.
• Income Tax Acts.
• Value Added Tax Act 1994.
• Social Security Contributions and Benefits Act 1992.
• Stamp Duty Land Tax legislation.
• PAYE Regulations.

Financial Crime Legislation

• Criminal Finances Act 2017.
• Proceeds of Crime Act 2002.
• Money Laundering Regulations 2017 (as amended).

Professional Standards

• Professional Conduct in Relation to Taxation (PCRT).
• Applicable ethical standards.
• Relevant legal professional obligations.

Regulatory Guidance

• HMRC published guidance.
• HMRC Statements of Practice.
• Relevant case law and tribunal decisions.

4. Tax Governance Framework

Governance Principles

The Firm’s tax governance framework is founded on the following principles:

• Accountability.
• Transparency.
• Compliance.
• Professionalism.
• Risk awareness.
• Ethical conduct.

Tax governance forms part of the Firm’s wider risk management and compliance framework.

Managing Partner Responsibilities

The Managing Partner retains ultimate responsibility for:

• Approval of this Strategy.
• Oversight of tax governance.
• Ensuring adequate resources.
• Reviewing material tax risks.
• Monitoring compliance.

The Managing Partner receives periodic reports concerning significant tax matters.

Board Responsibilities

The Board is responsible for:

• Reviewing significant tax risks.
• Approving major tax-related decisions.
• Monitoring compliance performance.
• Ensuring alignment with the Firm’s risk appetite.

Material tax matters may be escalated to the Board where appropriate.

Finance Director Responsibilities

The Finance Director is responsible for:

• Day-to-day tax management.
• Oversight of compliance processes.
• Tax reporting.
• Tax control implementation.
• External adviser management.
• HMRC engagement.

Compliance Officer Responsibilities

The Compliance Officer shall:

• Monitor governance arrangements.
• Review tax-related risks.
• Support regulatory compliance.
• Coordinate investigations where necessary.

5. Tax Risk Appetite

Parker Russell adopts a low-risk approach to taxation.

The Firm has no appetite for:

• Tax evasion.
• Criminal facilitation of tax evasion.
• Aggressive tax avoidance.
• Artificial tax structures.
• Transactions lacking commercial substance.
• Arrangements likely to create reputational harm.

The Firm is prepared to accept only those tax risks that arise naturally from ordinary commercial activities and professional judgement.

6. Tax Risk Management

The Firm maintains a structured framework for identifying, assessing and managing tax risks.

Sources of Tax Risk

Tax risks may arise from:

• Legislative changes.
• Business expansion.
• New service lines.
• Corporate transactions.
• Employment arrangements.
• International activities.
• VAT treatment uncertainties.
• Changes in case law.

Risk Assessment Process

Tax risks are assessed by considering:

Financial Exposure

Potential tax liabilities, penalties and interest.

Regulatory Exposure

Potential regulatory scrutiny or intervention.

Reputational Exposure

Potential adverse publicity.

Operational Exposure

Impact on business operations.

Legal Exposure

Potential disputes or litigation.

7. Internal Controls

The Firm maintains robust internal controls designed to support tax compliance.

Controls include:

• Segregation of duties.
• Management review procedures.
• Authorisation controls.
• Financial reconciliations.
• Documentation requirements.
• Compliance checklists.
• Filing deadline monitoring.
• External adviser reviews where appropriate.

8. Approach to Tax Planning

The Firm supports responsible tax planning where it:

• Supports genuine commercial objectives.
• Reflects economic substance.
• Complies with applicable legislation.
• Aligns with professional standards.

Tax planning is considered within the context of:

• Commercial rationale.
• Regulatory expectations.
• Reputational considerations.
• Stakeholder expectations.

Prohibited Activities

The Firm will not:

• Participate in abusive tax avoidance schemes.
• Enter into artificial structures.
• Exploit legislative loopholes contrary to parliamentary intent.
• Undertake arrangements lacking commercial substance.
• Facilitate tax evasion.

9. Criminal Finances Act Compliance

The Firm operates a zero-tolerance approach towards tax evasion and the facilitation of tax evasion.

Reasonable prevention procedures include:

• Risk assessments.
• Staff training.
• Due diligence procedures.
• Whistleblowing arrangements.
• Monitoring and review processes.

Employees must report any concerns immediately.

10. Relationship with HMRC

The Firm seeks to maintain a professional, transparent and constructive relationship with HM Revenue & Customs.

We aim to:

• File accurate returns.
• Meet statutory deadlines.
• Pay taxes when due.
• Respond promptly to enquiries.
• Cooperate during reviews and investigations.

Where uncertainty exists, the Firm may:

• Seek specialist advice.
• Consult HMRC guidance.
• Request formal clearances.

11. Tax Transparency

The Firm is committed to transparency in its tax affairs.

We seek to:

• Maintain accurate records.
• Provide complete disclosures.
• Cooperate with tax authorities.
• Address errors promptly.

Where errors are identified, corrective action will be taken without delay.

12. Third-Party Management

The Firm recognises that tax risks may arise through third-party relationships.

Appropriate due diligence may be undertaken regarding:

• Professional advisers.
• Contractors.
• Consultants.
• Outsourced service providers.
• Overseas service providers.

Third parties are expected to comply with applicable tax legislation.

13. Training and Competence

Relevant personnel receive training concerning:

• Tax compliance obligations.
• Legislative developments.
• Financial crime risks.
• Criminal Finances Act requirements.
• Internal procedures.

Training requirements are reviewed periodically.

14. ESG and Responsible Tax

The Firm recognises that responsible taxation is a key component of Environmental, Social and Governance (ESG) performance.

Our approach to tax supports:

• Ethical business conduct.
• Sustainable growth.
• Transparency.
• Good governance.
• Public trust.

Tax decisions are evaluated alongside legal, ethical and reputational considerations.

15. Monitoring, Assurance and Audit

The effectiveness of this Strategy is assessed through:

• Internal reviews.
• Compliance monitoring.
• External adviser engagement.
• Financial audits.
• Risk assessments.
• Board oversight.

Corrective action is implemented where improvements are identified.

16. Policy Breaches

Breaches of this Strategy may result in:

• Disciplinary action.
• Regulatory reporting.
• Contractual consequences.
• Civil proceedings.
• Criminal prosecution.

The Firm will investigate any suspected breach thoroughly and fairly.

17. Related Policies

This Strategy should be read in conjunction with:

• Anti-Bribery and Corruption Policy.
• Anti-Money Laundering Policy.
• Financial Crime Prevention Policy.
• Risk Management Policy.
• Whistleblowing Policy.
• Third-Party Code of Conduct.
• Modern Slavery Statement.
• ESG Policy.
• Information Security Policy.

18. Review and Approval

This Strategy shall be reviewed annually by the Managing Partner, Finance Director and Compliance Officer.

Additional reviews may be undertaken where:

• Tax legislation changes.
• Regulatory guidance changes.
• Material business changes occur.
• Significant risks emerge.

Approved by: Managing Partner

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