1. Introduction
1.1 Background
WJH Holdings is a privately owned, family run group based in the South of England. It is the holding company for Harwoods Ltd which is a business in the automotive retail sector. Harwoods holds franchises for Jaguar, Land Rover, Audi, Bentley, Aston Martin, BMW, Mini & MAN.
This document sets out the strategic tax objectives of WJH Holdings Limited and its subsidiaries ("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.
1.2 Approval
The 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 2016.
1.3 Audience
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 intranet and website.
1.4 Scope
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 and Customs and Excise Duty
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
2.1 Summary
The vision of the business is to create memorable experiences for our customers and staff.
The tax strategy is designed to support this vision.
WJH group 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
Approach to risk management and governance arrangements in relation to UK taxation
We will operate effective tax governance, understanding the tax risks in place and ensure that senior personnel with the appropriate skill and experience are involved in key tax decisions.
The Group uses third party advisors to provide advice and guidance necessary to assess tax risks and ensure its compliance to applicable laws, rules, regulations and reporting and disclosure requirements.
The group wants to ensure that it pays an appropriate amount of tax in relation to its commercial activities.It does not engage in aggressive tax planning arrangements, and believes that it’s conservative in its approach to tax planning, applying tax rules and regulation in a way that it considers is consistent with parliament’s intention, and HMRC expectations.
As the group does not engage in tax planning arrangements where there is considered to be a significant risk of challenge by HMRC, the group does not maintain any form of risk register.Any matters where there is considered to be an unexpected, previously unidentified, or un-provided tax exposure are discussed between the Finance Director and the Board of Directors as may be appropriate, and if necessary referred to Board meetings for discussion, and on to discussion with the HMRC Customer Relationship Manager.
The group has a large and capable finance team of 37 staff.All staff have clear roles and responsibilities to ensure compliance with tax (and financial) requirements.Staff are suitably skilled, and training is offered as considered relevant.In cases of uncertainty, matters will be referred to the Finance Director or Group Compliance Manager who may seek advice from external professional advisors, or seek advice from HMRC direct, by contacting the HMRC Customer Relationship manager or one of the members of the HMRC team for assistance in interpretation of application of tax rules.
Attitude towards tax planning and level of risk it is prepared to accept
We expect to maintain a low risk rating with HMRC.
The Group takes a conservative approach to tax planning and does not pursue aggressive tax planning arrangements.Where alternative routes exist to achieve the same commercial result the most tax efficient approach in compliance with all relevant laws shall be considered.
We seek to be efficient in our tax affairs but ensure that any planning is based on sound commercial principles.
We will take advantage of the reliefs and incentives that exist but show respect for the intention of the law, as well as the letter, at all times.
The Group will use incentives and reliefs to minimise the tax costs of conducting its business activities, but will only undertake arrangements which they reasonably believe do not contradict the spirit of the law.For example, the Group will not undertake transactions for tax which are inconsistent with the underlying economic consequences or undertake marketed avoidance.The company will not establish business in tax havens.
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. We meet regularly with our Customer Relationship Manager to discuss all areas of taxes and seek advice in cases of uncertainty. 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.
3. Governance
The Board of Directors acknowledges that is has responsibility for fully complying with the tax laws in all relevant jurisdictions.
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 Paul Suter, as the 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.
3.1 Structure and organisation
The organisation of the management of tax across the group can be described as follows:
Finance Team
The Finance team employs various risk management processes and systems to provide assurance that the requirements of the Group’s tax strategy are met.
Compliance Team
The Group Compliance Manager carries out regular checks to ensure that the Group correctly accounts for, records and treats for tax purposes, all activities of the group.He also controls some specific items such as the zero rating of vehicles.
Use of Professional advisors
Matters where the 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 strategy and risks, as well as internal controls and systems employed by the Group on an ongoing basis.