The implications of the BEPS recommendations' focus on reporting and transparency.
The aspect of the BEPS project which has arguably been the highest profile to date has been the continued march towards increased transparency and disclosure relating to a group’s tax affairs. Historically, the tax affairs of a company (and indeed of an individual) have been a private matter between the taxpayer and the relevant tax authority. This however is changing, and the BEPS recommendations acknowledge this through their focus on reporting and transparency.
The implications of this for the business may be obvious but they are nonetheless alarming for many groups:
In light of this increasingly transparent environment, groups (especially those operating multinationally) will need to ensure they allow sufficient time and resource to collating and reviewing the reports and documentation required by BEPS. Data will need to be cross-checked for completeness and consistency.
For those groups which recognise that the move towards greater transparency is a one way street, there will be opportunities to proactively manage the flow of information and the accompanying messages, promoting the group as a responsible contributor to society. All of this requires a change in mind set across the business and cannot be the sole responsibility of tax.
We can work with you to prepare and sense-check the reporting and documentation requirements introduced by the BEPS project (the country by country report, and the masterfile and local file transfer pricing reports). However, in addition, we also have extensive experience of working with groups to manage their tax profile both with tax authorities, with the public and with other stakeholders.
Who to speak to?
Julie Hughff, Komal Dhall