The Society's Tax Strategy

Our aim is to pay the right amount of tax and file the right returns on time, while maintaining a good reputation with HMRC, other tax authorities and our policyholders

How we will do this

1) We will operate within our risk management and governance framework

i. Our tax strategy and policy guides our operation

ii. Both are approved by Board

iii. The tax team reports to the Chief Financial Officer who is the Senior Accounting Officer for tax and reports in turn to the Chief Executive Officer, a Board member

iv. The Audit & Risk Committee receive regular reports on tax matters to inform Board

v. Controls over data are governed by our Information and Data Protection policies

vi. We identify changes to tax legislation and implement the required amendments to systems and processes

vii. We document and improve our processes and systems

viii. We employ the right number of qualified staff and cross-train our teams

ix. Tax calculations and payments are subject to internal independent verification

x. We use external advisors to advise on significant transactions

2) We will do the right thing for policyholders and tax authorities

i. We regularly meet and talk with HMRC to ensure no surprises, explain our strategy, plans and risks. We also proactively raise these matters with other tax authorities when appropriate.

ii. We have no appetite for tax avoidance or evasion schemes and do not undertake tax planning for these purposes

iii. We aim to be a low risk customer of HMRC

iv. Whilst accepting that mistakes do happen, we aim to ensure zero penalties or charges

v. When they do, we will quickly rectify them, inform the relevant tax authorities, and fully co-operate with any resultant audit and investigations

vi. For non-routine matters we will utilise advance clearance procedures with the relevant tax authorities. If such clearances are not available, we will state clearly to the tax authorities our interpretation of the applicable rules and expected outcomes

vii. If we have strong evidence we are overpaying tax, we will discuss and agree the way forward with Audit and Risk Committee and then with the relevant tax authorities

viii. We do not game the system

ix. We do not challenge tax rates and scope set by Governments

x. We will carry out our duties in accordance with our values of:

• Transparency;
• Fairness;
• Affordability;
• Delivering for our policyholders

How we will know we are being successful

a) All tax returns are filed on time
b) All payments are made on time
c) All tax accounts will be reconciled
d) Audits will not identify surprises and rectification will be timely
e) The tax implications of transactions and projects will be understood in advance by all sides and where appropriate, formally agreed with the tax authorities

The Society regards the publication of the above information as complying with its duty under Finance Act 2016, Schedule 19 Paragraph 16(2) for the Financial Year 2019.