DCS Group (UK) Limited Tax Strategy
The Board of DCS Group (UK) Ltd is responsible for ensuring that the tax obligations of the Company are understood, complied with and managed appropriately. Fulfilling its tax obligations and maintaining a transparent and cooperative relationship with HMRC is integral to the Company’s Tax Strategy.
DCS Group (UK) Ltd (“DCS”) is a privately owned, family run company based in Banbury. DCS is the UK sales and marketing company for health, beauty and household manufacturers such as P&G, Gillette, Unilever, Colgate, SC Johnson, Johnson & Johnson and PZ Cussons among others. DCS offers a range of added value services including brand repacking, design, merchandising and category management.
This document sets out the strategic tax objectives of DCS Group (UK) Limited and its associated group companies (“the Group”).
It is not designed to be an operational manual with detailed instructions of the underlying processes and controls. Further commentary around the systems and risk management framework of the Group is contained within the group’s compliance systems.
The Group Finance Director is responsible for leading the Tax Strategy. The strategy is approved by the Board of Directors.
The document will be periodically reviewed and any amendments will be approved by the Board of Directors. It is effective for the year ended 31 December 2017.
This document is primarily of relevance to the Finance Team together with the Board of Directors who are responsible for tax across the organisation.
The policy is available to all employees and can be found on the company website.
The purpose of the Tax Strategy is to communicate the policy for the management of tax within the Group. It is important to ensure that consistent and effective tax standards are maintained across the Group as tax (both direct and indirect) can have a significant cash and profit and loss impact on the Group and therefore on many of the Group’s business activities.
The group operates wholly in the UK, and therefore has no overseas activities; and does not pay tax in any overseas jurisdictions.
The following taxes are in scope
- All direct taxes including Pay As You Earn (PAYE) and Corporation Tax (CT)
- All indirect taxes including VAT
The strategy applies, in respect of all companies in the group, to:
- Tax compliance of all in scope taxes
- Tax financial reporting
2. Our Strategy
The company’s vision is to encourage Innovation, Enterprise and Entrepreneurship as well as strong values and business ethics. The company is passionate about achieving excellence and growth and its primary goal is to delight its customers and to create lifetime loyalty. The company believes strongly in sustainability and responsibility.
The tax strategy is designed to support this vision.
DCS is committed to paying the right amount of tax required under the laws and regulations of UK tax legislation and practice. It takes a conservative approach to tax planning, and does not pursue aggressive tax planning arrangements. The group uses third party advisors to provide advice and guidance necessary to assess the tax risks and ensure its compliance with applicable laws, rules, regulations, and reporting and disclosure requirements.
2.2 Tax objectives
The Group Finance Director is responsible for all taxes within the Group. The objective in relation to tax is to support the Group’s strategy whilst ensuring compliance with relevant laws and filing obligations.
Tax performance will be measured in the following ways:
- A clearly understood, communicated and supported strategy;
- Paying the appropriate amount of tax at the appropriate time;
- Forecasting and planning tax cash payments accurately;
- Ensuring the most effective tax elections, claims and options are considered, with respect to materiality, to manage the tax paid by the Group;
- Implementing and maintaining controls and procedures relating to all taxes ensuring that the correct amount of tax is paid,
- Inspections or reviews by HM Revenue & Customs (“HMRC”) and other regulators do not lead to the imposition of any fines or penalties, Enabling the Senior Accounting Officer to provide the annual certification required under Schedule 46 Finance Act 2009; and,
- Act in a proactive fashion in relation to the Group’s tax affairs;
- To maintain the Group’s reputation as a fair contributor to the UK economy which applies tax rules in good faith and in the spirit, they are intended.
3. The control activities
3.1 Risk management
Effective risk management is paramount for the Group and underpins its business strategy. The Group’s appetite for risk is a carefully calibrated part of the business model aligned to the strategic and corporate objectives.
The Group’s on-going tax risk approach is based on principles of reasonable care and materiality. Each tax risk is measured based on a balance of impact of that risk and its likelihood and is recorded in the tax risk register. Impact may consider financial and non-financial factors.
The aim is not to avoid or eliminate risk entirely, but to manage closely the Group’s exposure to risk. Control and assurance activities are mapped against each risk identified.
3.2 Risk register
The business has put in place a tax specific risk register designed to identify and monitor tax risk within the Group. The tax risk register is designed to:
- Identify tax risks in a consistent and formal manner;
- Assess tax risks using standardised definitions;
- Formalise the tax risk management framework;
- Facilitate testing of mitigating controls i.e. monitoring;
- Provide an escalation framework to the main risk register; and,
- Give visibility for high level Board reporting to facilitate appropriate oversight over the tax risk identification and monitoring framework.
The areas of tax risk managed by the business will be subject to on-going review by the Group Finance Director and further documentation will be developed where deemed necessary.
4. Approach to dealing with HMRC
We will avoid unnecessary time-consuming disputes wherever possible.
We are committed to working in a collaborative, transparent and proactive way with HMRC at all times. We adopt the principles of openness and transparency in our approach to dealing with HMRC and believe in engaging in full, open and early dialogue with HMRC to discuss the Group’s tax affairs. The Group is committed to making fair, accurate and timely disclosure in correspondence and returns, and respond to queries raised by HMRC in a timely manner with the aim to resolve any issues in real-time where possible or to work together to resolve issues quickly and efficiently, with certainty wherever possible.
The Board of Directors acknowledges that is has responsibility for fully complying with the tax laws.
The Board of Directors is responsible for establishing the overall governance and approving the tax strategy. However, management authority for the day to day operation of the business is delegated to the Group Finance Director. Tax is considered as part of the overall governance framework.
To ensure that the Tax Strategy is delivered; diligent professional care and judgement will be employed to assess tax risks in order to arrive at well-reasoned conclusions on how the risks should be managed.
6. Structure and organisation
The organisation of the management of tax across the group can be described as follows:
The Finance team employs various risk management processes and systems to provide assurance that the requirements of the Group’s tax strategy are met.
Use of Professional advisors
Matters where the Group Finance Director considers there is insufficient skill or experience internally are referred to external professional advisors who have suitable knowledge of the company, and hold suitable accounting and tax qualifications, as well as relevant experience.
The Board of Directors review the Groups tax strategies and risks as well as internal controls and systems employed by the Group on an ongoing basis.