Financial Information Tax strategy

Introduction

KCOM is a communications and services company acting responsibly and creating value for all our stakeholders.  Our solid foundations date back to 1904 when a quirk of history gave Hull and East Yorkshire its own phone company.


We are constantly evolving so we can continue to help customers create greater value from the way they interact, collaborate and connect with what matters to them.


Being responsible is second nature to us.  KCOM maintains high ethical standards and this includes complying with the tax laws under which we operate and paying the correct taxes.


KCOM now publishes its tax strategy in accordance with measures contained in section 161 and Schedule 19 of Finance Act 2016.


The strategy has been reviewed by the Board of KCOM Group PLC and will be reviewed annually.

 

KCOM’s approach to risk management and governance arrangements

The Group’s policy is to comply with all relevant laws, rules and regulations and to pay the right amount of tax on time.


We have created policies and processes to ensure there is a framework and culture to underpin the requirements above.


The Chief Financial Officer is responsible for the management of the Group’s tax affairs and is also the Senior Accounting Officer.  She is supported by the Finance Director, Business Support and the Head of Tax and Treasury.  Tax compliance is reported on a monthly basis to the Board.


The Audit Committee reviews the tax disclosure made in the annual report and is made aware of any significant tax issues.


The Group follows a policy of continuous improvement to ensure processes evolve to reflect changes in business operations and the relevant legislation and guidance.


Professional advice is used to achieve best practice in the above.  The Corporation Tax returns are reviewed by an external professional adviser before submission to HMRC.

 

KCOM’s attitude to tax planning

KCOM seeks to reduce the risk of uncertainty and disputes by adhering to the relevant tax laws.  We do not engage in artificial tax engagements.
The Group tax department engages with the business to ensure efficient tax planning both in day to day commercial affairs and where larger transactions, re-organisations or restructures take place

 

The level of risk that KCOM is prepared to accept

KCOM takes a conservative approach to tax risk, which it manages by:


• Creating, reviewing and updating tax policies and processes on an operational basis to reduce overall tax risk
• Engaging with professional advisers  to best understand complex issues and current industry and tax best practice
• Creating a top to bottom culture business wide that follows the appropriate policies
• Making major business decisions on a commercial first basis
• Not engaging in aggressive/high risk tax planning and solutions
• Engaging with HMRC, on a full disclosure basis, when uncertainty regarding transactions exist.  This includes applying for the correct clearances from HMRC where required

 

KCOM’s approach toward its dealing with HMRC


KCOM is committed to working with HMRC on an open, transparent and collaborative basis.
Our aim is to:


• Engage in open dialogue with HMRC regarding our tax strategy, underlying policy and process to ensure a better understanding of our organisation
• Approach HMRC where uncertainty exists
• Make full disclosure on a timely manner in a way that aids understanding of any issues
• Provide information regarding large transactions before the event when this is commercially possible
• Work with our CRM and tax specialists in all taxes to build professional and trusted relationships
• To interpret tax laws in a reasonable way and not in a way contrary to their purpose and be open and transparent with regard to our tax planning