Question to the HM Treasury:

To ask His Majesty's Government whether they have powers to require (1) listed and large unlisted companies to provide information on their UK taxation compliance, and (2) fund and pension fund managers to pass information about a company’s taxation compliance to their clients.

There is no HM Government power that requires:

(1) listed and large unlisted companies to provide information on their UK taxation compliance (to their shareholders), and

(2) fund and pension fund managers to pass information about a company’s taxation compliance to their clients.

However, there are two legislative obligations that require disclosure about a large company’s approach to their tax obligations.

1. Senior Accounting Officer regime

Large companies are required to appoint a senior accounting officer (SAO). The SAO must take reasonable steps to ensure that the company establishes and maintains appropriate accounting arrangements that will enable the company’s relevant liabilities to be calculated accurately in all material respects.

Additionally, the SAO must annually provide HMRC with a certificate to confirm that the company has maintained appropriate accounting arrangements throughout the year. Where the SAO is unable to provide that assurance, they must provide an explanation of the respects in which the accounting arrangements of the company fell short of being able to accurately calculate the company’s tax liability.

This certification is provided to HMRC but is not available publicly.

2. Publication of Tax Strategies

Large companies are required to annually publish a tax strategy which includes the:

• approach of the group to risk management and governance arrangements in relation to UK taxation,
• attitude of the group towards tax planning (so far as affecting UK taxation),
• level of risk in relation to UK taxation that the group is prepared to accept, and
• their approach of the group towards its dealings with HMRC.

This information is available to shareholders and the general public. However, it does not require the company to publish the amount of taxes and duties paid as part of their tax strategy, or information that is commercially sensitive.

In addition to these two general information powers, HMRC has the power to require specific information as part of a compliance check. However, this information would be to confirm or quantify a company’s tax liability, and not provide information on their general tax compliance.

None of the powers described above oblige fund managers to pass details of their approach to tax compliance to their clients.