{ "docId": "019dd923-5e88-73ef-bd58-07b375a7cd5b", "docSlug": "335ba522863769dc", "documentTitle": "Banking and capital markets trends 2020: Laying the foundations for growth", "authorId": "PwC", "authorName": "PwC", "documentKindSlug": "consulting-deck", "documentKindLabel": "Consulting deck", "sourceTypeSlug": "strategy_consulting", "sourceTypeLabel": "Strategy consulting", "presentationDate": null, "orientation": "landscape", "aspectRatio": 1.414, "pageNumber": 81, "pageCount": 88, "prevPage": 80, "nextPage": 82, "slideType": "industry_trends", "function": "establish_context", "density": "overcrowded", "nDataPoints": 0, "notes": null, "elementsJson": [ "headline_text", "paragraph", "bullet_list" ], "metadataConfidence": 0.9, "imagePath": null, "slideHref": "/slides/019dd923-5e88-73ef-bd58-07b375a7cd5b/81", "deckHref": "/decks/019dd923-5e88-73ef-bd58-07b375a7cd5b", "deckJsonHref": "/decks/019dd923-5e88-73ef-bd58-07b375a7cd5b.json", "deckAnchorHref": "/decks/019dd923-5e88-73ef-bd58-07b375a7cd5b#slide-81", "components": [ { "bbox": { "h": 0.15, "w": 0.45, "x": 0.05, "y": 0.51 }, "kind": "list", "text": "The risk of the following not be correctly captured or reports can result in potential fines and / or tax authority scrutiny:\n- Creation of a branch (taxable permanent establishment) in UK or overseas for corporation tax.\n- Staff working overseas creating local PAYE and income tax liabilities.\n- Supplies being deemed to be made from an overseas location triggering a requirement to register and account for VAT.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "020f3db2-ddbb-46fd-8d3a-dfe85b658cb6", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.45, "x": 0.52, "y": 0.51 }, "kind": "list", "text": "- Groups seeking to achieve 'low risk' status will need to be able to demonstrate they have in place an effective TCF, and that this is consistent with SAO arrangements and the published tax strategy.\n- A higher risk rating can result in increased scrutiny from HMRC and increased management time dealing with enquiries.\n- Failure to provide evidence of this to HMRC may result in a higher risk rating, and so more scrutiny.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "77d19868-be3f-4f1d-ac25-464abcc5234d", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.06, "w": 0.45, "x": 0.52, "y": 0.73 }, "kind": "list", "text": "- Assess the governance, controls, processes and documentation in place to ensure the TCF is effective, fit for purpose and consistent with the SAO arrangements and tax strategy.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "e09aa8d9-6d72-4f85-a85f-75aa05e78c88", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.12, "w": 0.45, "x": 0.05, "y": 0.73 }, "kind": "list", "text": "Internal audit should assess management's processes and controls to:\n- Identify appropriate tax/HR policies and ensure they align with the rules in the territories in which you operate.\n- Track people movements using travel systems or other data.\n- Review activities in these jurisdictions for high risk areas.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "f49e8a3c-12d7-4241-9759-eb977f103cbd", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.03, "w": 0.45, "x": 0.05, "y": 0.69 }, "kind": "paragraph", "text": "Internal audit focus", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "1e9d5e60-ef8e-4041-a8f2-339e6ce364bb", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.08, "w": 0.45, "x": 0.05, "y": 0.26 }, "kind": "paragraph", "text": "Following the Organisation for Economic Co-operation and Development ('OECD') Base Erosion and Profit Shifting ('BEPS') programme, tax authorities (both HMRC and non-UK) have been increasing their efforts to track people movements (e.g. fly-in, fly out bankers) in order to identify whether taxable activity is taking place.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "21f65e13-7190-4e51-b853-1f61f026bfdd", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.18, "w": 0.45, "x": 0.52, "y": 0.26 }, "kind": "paragraph", "text": "Following a public consultation, in October 2019 HMRC launched a revised BRR process – this is the process by which HMRC risk-assesses large businesses. This assessment is a key determinant of the level of scrutiny applied by HMRC and the level of resource a business needs in response. Previously each large business was classified as either 'low risk' or 'not low risk'. However, the new BRR process has a spectrum of risk ratings.\n\nThe process now also takes formal account of Senior Accounting Officer (SAO) arrangements, a firm's published tax strategy and compliance with the Banking Code of Practice. 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